- Optical network stocks -- moving up and down of late with any news on demand from China -- got a lift today as analysts pointed to a likely recovery there.
- Applied Optoelectronics (NASDAQ:AAOI) rose 12.1% to a new all-time high. Other related names: Oclaro (NASDAQ:OCLR) +10.2%; Finisar (NASDAQ:FNSR) +10.2%; Lumentum (NASDAQ:LITE) +7.5%; NeoPhotonics (NYSE:NPTN) +10%; Emcore (NASDAQ:EMKR) +3%. Macom Technology (NASDAQ:MTSI), with Optoelectronics and Photonic Solutions units among its businesses, closed up 8.3%.
- Needham launched Applied Opto at Strong Buy, expecting ASPs and margins to go up as the company's product mix moves toward 25G/100G products from the existing 10G/40G line. Applied is the market share leader and the low-cost supplier, Needham says.
- Meanwhile, Jefferies reiterated Buys on Oclaro, Lumentum and Finisar, pointing to China Mobile's vendor selection for its packet transport network mostly going to ZTE (to which Oclaro has 10% revenue exposure).
- China Telecom and China Unicom will follow up with their tenders later this year, and Jefferies' James Kisner expects they will reinforce what looks like a return to spending in the sector.
- Now read: Applied Optoelectronics: Worth The Hype?
Original article