Jefferies Lowers Estimates on Finisar (FNSR), High Hopes for 2013

Following a slower recovery of the WSS/ROADM business and recent data points from JDS Uniphase (Nasdaq: JDSU) and other competitors, Jefferies is lowering its 2012 EPS and revenue estimates on Finisar (NASDAQ: FNSR) from $0.95 and $993.7 million to $0.91 and $978.3 million. For 2013, the firm now estimates EPS of $1.55 with $1.185 billion in revenue, down from $1.60 and $1.207 billion in revenue previously.

Jefferies reports that inventory corrections that began in late 2010 and early 2011 are over and that optical component vendor concerns are now on underlying near-term demand.

There may be some upside to the firms estimates gives positive data points from Cisco's (Nasdaq: CSCO) Switching business, JDS Uniphase's commentary on the segment, and Avago's (Nasdaq: AVGO) positive Wired Infrastructure results.

"Based on JDS Uniphase’s results and commentary, we’re slightly more cautious on the outlook for a recovery in Finisar’s ROADM/WSS revenue," states an analyst at Jefferies.

Jefferies is reaffirming its Buy rating and $23 price target on shares of Finisar.

For more ratings news on Finisar click here and for the rating history of Finisar click here.

Shares of Finisar closed at $18.08 yesterday.

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