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Thesis
The demand for broadband infrastructure has been strong in 2022 and is predicted to continue in 2023. Harmonic (NASDAQ:HLIT) is well-positioned to enter the new year with a growing tier 1 customer base
Harmonic Remains Well-Positioned With Its Tech Leadership
Summary
- Harmonic benefited from surging broadband demand in 2022, and I believe the company remains well-positioned in 2023.
- This sizeable amount of backlog and deferred revenue is a testament to the high level of demand from the company’s major broadband customers, as well as expanding video SaaS commitments.
- HLIT’s gross margins are expected to expand further with its increased cloud-based SaaS offerings, expanding video pipeline, and growing traction for its CableOS solution.
- My Dec-23 price target of $19.6 is derived from a forward PE multiple assumption of 20x applied to the consensus EPS estimate of $0.98 for 2024.
Financial Analyst. Interested in growth stocks with a unique MOAT.
Analyst’s Disclosure:I/we have a beneficial long position in the shares of HLIT either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
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