Shares of Network Appliance, Inc. (NASDAQ: NTAP) rose Thursday, following a strong third quarter and upgraded estimates from an investment bank.

The storage-technology company made $66.7 million in profit on $729.3 million in revenue for its third quarter, earning 17 cents per share. Excluding one time costs, the company would have made 29 cents per share, beating Wall Street expectations by 1 cent.

We expect NetApp to provide FY2008 (ending 4/08) revenue growth targets in the 30%+ range on top of FY07’s estimated 36% growth, said Laura Conigliaro of Goldman Sachs. That said, we are leaving our Neutral rating based on our 12-month price target of $40, revised up from our prior $38.

Conigliaro believes that the firm can continue to grow versus its more mature competitors. The combination of ongoing strength in its core filer business, increasing sales through IBM, and emerging opportunities like Decru and Topio should allow NetApp to grow between 1.5 to 3 times its two closest competitors over the next four quarters, she said.

The investment bank raised its EPS estimates for 2008 to $1.42 from $1.40, and its 2009 EPS estimates to $1.79 to $174.

Shares of Network Appliance rose 4 percent, or $1.59, to $40 by in afternoon trading on the Nasdaq Stock Market.