MKM Partners Q1 Preview on Finisar (FNSR): In-line Quarter and Outlook Won't Be N-T Catalyst

August 29, 2012 10:54 AM EDT Send to a Friend
Get Alerts FNSR Hot Sheet
Price: $17.47 +4.49%

Rating Summary:
    12 Buy, 7 Hold, 0 Sell

Rating Trend: Down Down

Today's Overall Ratings:
    Up: 14 | Down: 20 | New: 31
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MKM Partners maintains a 'Buy' on Finisar (NASDAQ: FNSR) price target of $16.50.

Analyst, Michael Genovese, said, "Finisar is set to report 1QFY13 (July) results on Tuesday, September 4, after the market close. We believe results should at least match our at-consensus $226mn (-6% q/q, -1% y/y) revenue and $0.14 EPS estimates. Management guided the quarter down sequentially because there are two fewer shipping days in 1QFY13 than in 4QFY12 and because it saw both Datacom and Telecom slightly declining. Our checks suggest that orders accelerated late in the July quarter, which should allow Finisar to meet or beat 1QFY13 and guide 2QFY13 revenues up about 5% q/q, or roughly in line with our at-consensus $237mn forecast."

On the call: 1) Investors will be listening for signs of fundamental demand improvement, but limited visibility may keep a lid on the tone; and 2) Growth in newer products is offsetting typical legacy product declines. Finisar is a share gainer with good margin leverage to higher volumes.

For an analyst ratings summary and ratings history on Finisar click here. For more ratings news on Finisar click here.

Shares of Finisar closed at $15.91 yesterday.


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