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Fabrinet management to meet with Piper Jaffray
Meeting to be held in Boston on December 11 hosted by Piper Jaffray.
China Mobile tender offer looks 'significant' for optical stocks, says Needham
Needham analyst Alex Henderson said the coherent transport ports tender offer announced by China Mobile (CHL) on its Chinese language website looks "significant in scale and material" for optical stocks. He noted that NeoPhotonics (NPTN) gets roughly 60% of revenue from China and is directly exposed to coherent demand, while Acacia (ACIA) gets 50% of revenue from China and is also directly exposed. He noted that Oclaro (OCLR), Lumentum (LITE), Finisar (FNSR) all have China exposure, but are less tied to coherent, while adding that "this order has no bearing" on Applied Optoelectronics (AAOI).
Facebook capex guidance positive for optical component suppliers, says Stifel
Stifel analyst Patrick Newton said Facebook's (FB) guidance for capital expenditures to double from a targeted $7B in 2017 to $14B in 2018 as a positive data point for Finisar (FNSR), Lumentum (LITE), Oclaro (OCLR), Fabrinet (FN), Infinera (INFN) and Ciena (CIEN). He believes Facebook's guidance reaffirms that cloud infrastructure spending is a multi-year trend and the weakness currently being experienced by optical component suppliers represents a near-term issue around timing of expenditures.
Fabrinet downgraded to Neutral from Overweight at JPMorgan
JPMorgan analyst Paul Coster downgraded Fabrinet to Neutral and cut his price target for the shares to $42 from $54. The company's Q2 guidance came in well below expectations on soft end market demand in China, Coster tells investors in a research note. He sees a lack of near-term catalysts and believes visibility is low.
Fabrinet price target lowered to $45 from $60 at Needham
Needham analyst Alex Henderson lowered his price target on Fabrinet to $45, citing the company's soft outlook for Q4. Henderson says most of the industry offered weak guidance for next quarter due to slowing China demand, adding that the company's cited telecom issues are not surprising. Looking at FY18, the analyst expects the company to post modest gains off the Q4 base if China remains flat, keeping his Strong Buy rating.
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