- Analyst Alex Henderson says "numerous indications from the component supply chain " point to a pickup in orders for components used in coherent optical transmission systems, which can lower the need for optical amplifiers and are proving popular for 100G deployments.
- Ciena (CIEN +1.8%), whose PT is raised to $28 from $22, is "unanimously noted" in the checks as having pulled in component orders.Though coherent demand is seen as the main factor, Henderson also reports hearing of strong demand OTN switching and carrier Ethernet gear.
- Henderson is also reiterating Buys on rival Infinera (INFN -0.8%) and component vendor NeoPhotonics (NPTN -2.9%) for the aforementioned reasons. Infinera tumbled last week in spite of beating Q2 estimates and providing above-consensus Q3 guidance, as investors decided they wanted more following huge YTD gains.
- Ciena has been rallying strongly since its June 6 FQ2 report (I, II).
- Other optical component vendors: JDSU, FNSR, OPLK, OCLR, AFOP
Needham hikes Ciena PT, says checks point to strong demand
Jul 29 2013, 14:14 ET