UPDATE: Goldman Sachs Upgrades Cambium Networks Corp. (CMBM) to Buy on Improved Revenue Visibility
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Goldman Sachs analyst Rod Hall upgraded Cambium Networks Corp. (NASDAQ: CMBM) from Neutral to Buy with a price target of $56.00.
The analyst comments "Cambium reported Q4 revenue 8% higher than our estimate, and went on to guide Q1 revenue 14% higher. FY’21 revenue guidance is 8% higher, despite baking in some conservatism from silicon supply constraints in H2’21. Better gross margins and good OpEx control drove EPS significantly higher than our estimate, as the company posted its third consecutive quarter of strong execution. We note that Cambium is seeing strong momentum in its PMP segment, even as the Wi-Fi segment is also expected to rebound strongly in 2021. With new products including the 60 GHz cnWave series aimed at addressing urban markets seeing strong initial traction, we believe Cambium has better visibility to achieve solid multi-year revenue growth. We also highlight the opportunity for gross margin expansion from higher margin Wi-Fi 6 increasing in the mix. While we acknowledge the strong rally in the stock price over the recent months, we see further upside from the company’s continued operational execution, strong revenue growth and margin expansion. We also believe that Cambium has good exposure to leisure and travel oriented businesses that should increase spending as economies re-open later this year."
Shares of Cambium Networks Corp. closed at $40.95 yesterday.
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