Seeking Alpha
Profile| Send Message|
( followers)  

NeoPhotonics (NYSE:NPTN), a photonic integrated circuit manufacturer, priced its IPO on February 2 at $11 per share, and gave a first-day return of 20.5%.

Business Overview (from prospectus)

We are a leading designer and manufacturer of photonic integrated circuit, or PIC, based modules and subsystems for bandwidth-intensive, high-speed communications networks. The rapid growth of bandwidth-intensive content, including HD and 3D video, music, social networking, video conferencing and other multimedia, is driving the demand for high-bandwidth products. The demand for bandwidth capacity is further intensified by the proliferation of network-attached devices, such as smartphones, laptops, netbooks, tablet computers, PCs, e-readers, televisions and gaming devices, that are enabling consumers to access bandwidth-intensive content anytime and anywhere over fixed and wireless networks, including 3G, and increasingly, LTE networks.

Offering: 7.5 million shares at $11 per share. Net proceeds of approximately $15.1 million will be used for debt repayment.

Lead Underwriters: BofA Merrill Lynch (NYSE:BAC), Deutsche Bank Securities (NYSE:DB)

Financial Highlights:

Revenue increased by $20.9 million to $132.9 million from the nine months ended September 30, 2009 to the nine months ended September 30, 2010...Cost of goods sold increased by $4.9 million to $91.1 million from the nine months ended September 30, 2009 to the nine months ended September 30, 2010...Research and development expense increased by $3.6 million from the nine months ended September 30, 2009 to the nine months ended September 30, 2010...Sales and marketing expense increased by $0.2 million to $7.5 million from the nine months ended September 30, 2009 to the nine months ended September 30, 2010...Net income increased to $2.9 million compared to a loss of $7.6 million from the nine months ended September 30, 2009 to the nine months ended September 30, 2010...

Competitors

We believe we compete favorably with respect to these factors. We believe our principal competitors include Finisar Corporation (NASDAQ:FNSR), JDS Uniphase Corporation (NASDAQ:JDSU), NTT Electronics Corporation, Source Photonics, Inc. and Sumitomo Electric Device Innovations, Inc (OTCPK:SMTOY). We also compete with various other companies. Our competitors may have substantially greater name recognition and technical, financial and marketing resources than we do. Many of our competitors have greater resources to develop products or pursue acquisitions, and more experience in developing or acquiring new products and technologies and in creating market awareness for these products and technologies than we do. In addition, a number of our competitors have the financial resources to offer competitive products at below market pricing levels that could prevent us from competing effectively and which could adversely affect our financial performance.

Additional Resources:

Source: Chip IPO: NeoPhotonics