Ribbon Communications initiated with a Buy at Rosenblatt

Rosenblatt initiated coverage of Ribbon Communications with a Buy rating and $5 price target. The investment thesis has significantly improved, the analyst tells investors in a research note, noting that the outlook for the high margin Edge & Cloud segment has gotten better, the company is well positioned for the spending shifts in its IP Optical segment, and its balance sheet is meaningfully better since last month when Ribbon closed on a $350M term loan and $35M revolver. Ribbon should grow revenues by 4% to 5%, and EPS by greater than 20%, per year from 2024 to 2026, as a base case, and potentially by significantly more, Rosenblatt added.