3 Reasons to Buy Brocade Communications Systems Today

Historically, tumultuous times offer some of the best opportunities to buy stocks, and the market's recent mess surely qualifies. Investors have cooled on many stocks lately, but many believe that storage networking firm Brocade Communications Systems (Nasdaq: BRCD  ) is worth a look.

In our Motley Fool CAPS community, 93% of the 624 investors rating the company are bullish, so there's no shortage of reasons why Brocade will thrive, three of which I've highlighted below.

But here at The Motley Fool, we're all for looking at both the good and bad sides of an investment. Once you're done with this article, you can read the case against the stock, weigh in with your own comments below, or rate Brocade in CAPS.

1. Foundry Networks integration
Although some investors were disappointed that Brocade wasn't in 3Com's (Nasdaq: COMS  ) position as a Hewlett-Packard (NYSE: HPQ  ) takeover target, the successful integration that Brocade has made with its own acquisition of Foundry Networks has helped assuage the pessimism. The acquisition has helped boost revenue in recent quarters and could help position the company well in a market with fierce competitors like Cisco (Nasdaq: CSCO  ) and Juniper Networks (NYSE: JNPR  ) .   

2. Tech rebound
While large companies like Cisco and IBM (NYSE: IBM  ) have reported increasing business in their recent quarters, smaller players like Emulex and Atheros (Nasdaq: ATHR  ) have also reported solid results, leading many investors to believe that -- despite the weak economy -- there is underlying strength in the technology sector. With improving results coming from a number of sectors in the tech industry, many investors like the way things are lining up in Brocade's favor.

3. Positive outlook
A solid following of CAPS members aren't the only ones with a bullish outlook for Brocade. Moody's recently raised its outlook for the company to positive, as it sees a more stable business today following the Foundry Networks integration. The ratings service also looks favorably on the moves the company has made to improve its liquidity and financial situation and forecasts strong demand for Brocade's products going forward.                                       

To see details of what CAPS members are saying now about Brocade, just click on over to Motley Fool CAPS and have a look -- or add your own thoughts directly to this story in the comments box below.

The Motley Fool Stock Advisor service looks for companies with strong management poised to beat the market over the long haul. To see all the stocks that have helped Tom and David Gardner beat the market by 50 points on average, take a free 30-day trial.

Fool contributor Dave Mock has three good reasons to play hooky tomorrow. He owns no shares of companies mentioned here. Atheros Communications is a Motley Fool Hidden Gems pick and the Fool owns shares. The Fool's disclosure policy doesn't need a cheat sheet.

Read/Post Comments (0) | Recommend This Article (1)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

Be the first one to comment on this article.

Compare Brokers

Fool Disclosure

Sponsored Links

Leaked: Apple's Next Smart Device
(Warning, it may shock you)
The secret is out... experts are predicting 458 million of these types of devices will be sold per year. 1 hyper-growth company stands to rake in maximum profit - and it's NOT Apple. Show me Apple's new smart gizmo!

DocumentId: 1112749, ~/Articles/ArticleHandler.aspx, 10/26/2016 11:45:04 AM

Report This Comment

Use this area to report a comment that you believe is in violation of the community guidelines. Our team will review the entry and take any appropriate action.

Sending report...

Today's Market

updated Moments ago Sponsored by:
DOW 18,222.04 52.77 0.29%
S&P 500 2,145.14 1.98 0.09%
NASD 5,273.60 -9.80 -0.19%

Create My Watchlist

Go to My Watchlist

You don't seem to be following any stocks yet!

Better investing starts with a watchlist. Now you can create a personalized watchlist and get immediate access to the personalized information you need to make successful investing decisions.

Data delayed up to 5 minutes

Related Tickers

10/26/2016 11:28 AM
BRCD $8.79 Up +0.03 +0.34%
Brocade Communicat… CAPS Rating: ****
ATHR.DL $0.00 Down +0.00 +0.00%
Atheros Communicat… CAPS Rating: ****
COMS $7.90 Down +0.00 +0.00%
3Com CAPS Rating: **
CSCO $30.78 Up +0.44 +1.46%
Cisco Systems CAPS Rating: ****
HPQ $14.00 Up +0.10 +0.68%
HP CAPS Rating: ***
IBM $152.39 Up +1.51 +1.00%
IBM CAPS Rating: ****
JNPR $26.39 Up +2.67 +11.24%
Juniper Networks CAPS Rating: **