Stifel's Ruckus launch: Firm sees carrier Wi-Fi "inflection point" arriving

|About: Ruckus Wireless (RKUS)|By:, SA News Editor

Stifel's Sanjiv Wadhwani, who started coverage on Ruckus (RKUS +4.7%) with a Buy and $17 PT today, notes that while U.S. mobile data traffic is expected to rise 53x-153x from 2010-2020 (growth will likely be stronger in some foreign markets), cellular network capacity is only expected to grow 25x. That leads him to think carrier Wi-Fi deployments will see an "inflection point" in 12-18 months.

Much like William Blair and Piper analysts, Wadhwani sees the arrival of the Hotspot 2.0 standard (allows mobile uses to be automatically logged into carrier Wi-Fi networks) acting as a growth driver.

He also sees healthy enterprise Wi-Fi growth, thanks in part to the adoption of the new 802.11ac standard (enables transmission speeds of up to 1Gbps), and calls Ruckus' BeamFlex tech "highly differentiated" due to its ability to limit signal interference in noisy environments.

A number of Wadhwani's arguments for Ruckus are also applicable to rival Aruba (ARUN +1%), which surged last week after posting an FQ1 beat and in-line FQ2 guidance.