Cormark sets new target of $4.00 !!!Sandvine is still a buy despite challenges, says Cormark September 9, 2015 By Nick Waddell 0 Comments Share this: 0 sandvine-head-officeBack to back misses have Cormark analyst Richard Tse feeling a little less bullish about Sandvine (TSX:SVC), but the analyst still thinks the stock is a buy. Shares of Sandvine fell sharply today after the company announced its second earnings warning in as many quarters. The company said revenue for its third quarter would come in at approximately (U.S.) $27-million. We continue to rely on large deals to fuel revenue growth but many of those deals are taking longer than expected to close. We still have visibility to a number of large opportunities and believe we are in a growth business, but unfortunately that growth may not be linear quarter to quarter or year to year, said CEO Dave Caputo. The variability in order cadence is a challenging aspect of participating in our market but one that is familiar to this team. We are confident that our strategy is focused on the best opportunities in our space and remain enthusiastic about Sandvines long-term prospects. Tse says the new revenue number comes in below his estimate of $31.7-million and the street consensus of $33-million. He says consecutive misses raise the obvious question of whether the cause is temporary or something structural. The reality is that while Sandvine continues to claim its challenges are different from its pure play competitors, the broad communications equipment market has been weak of late if we look to comments across the peer group regardless of service offering, said Tse. The bigger risk is that the above delays may not be temporary as current network upgrades and innovative technologies (like NFV and SDN) are potential culprits to these delays which would mean the causes are more structural for Sandvine and its peers. Tse says he continues to believe Sandvine is a leader in the evolving network traffic applications space, and that the recent pullback is a buying opportunity for investors. In a research update to clients today, Tse maintained his Buy rating on Sandvine, but lowered his one year target price on the stock from $5.00 to $4.00.