Needham & Company Reiterates Buy as Fabrinet (FN) is 'Increasingly Optimistic' - PT to $35

Needham & Company reiterated a Buy rating on Fabrinet (NYSE: FN), and raised the price target to $35.00 (from $32.00), after meeting with management. According to management, FN is “increasingly optimistic on demand growth and industry strength” Despite CIEN’s soft CY16 guide, which reflects CIEN's execution issues, currency pressures and demand timing, FN is seeing strengthening demand across most of its core product lines.

Analyst Alex Henderson commented, "We are increasing our Target Price to $35 from $32 on Fabrinet after meeting with management and visiting the Fabrinet West Prototyping facility in Santa Clara. We come away from the meeting with a high degree of confidence in Fabrinet's outlook for both Revenues and Margins. Fabrinet is well positioned for Metro Core ROADMs with the top players production. It's picking up the largest producer of DCO Coherent pluggables, which is just starting to shift from Sanmina, and it is also well positioned for Industrial lasers and for strong 100G Data Comm. Yet it's only trading at a slight 0.8x EV/Sales and 10x EV/E."

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

Shares of Fabrinet closed at $27.83 yesterday.

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