JDS Uniphase Sees Strong Growth Ahead - Analyst Blog

Recently, JDS Uniphase Corp. JDSU expressed its confidence about an improved performance in the near term, primarily buoyed by increased deployment of optical fiber networks and 4G LTE (long-Term Evolution) networks.

The company is a leading provider of communications test and measurement solutions, and optical products to telecom carriers, cable operators and network equipment manufacturers.

Importantly, JDS Uniphase has established a viable position in both wireline and wireless segments. In the wireline segment, data communications is the main focused area of the company.

Currently, this segment is upgrading from 10 Gbps speed to 40 Gbps speed. In the preceding quarter, the company's Cloud and Data Center business generated significant pre-bookings related to the new 40 Gbps version of its Xgig storage solution.

Additionally, JDS Uniphase sells its equipment directly to some large hyperscale data centers. Hyperscale data centers are those large company's which builds their own datacom networks. Although this business generates not very significant revenues, it did help the company in terms of high margins.

On the other side, in the telecom infrastructure sector, the competition is mainly in the 100 Gbps network. Here, JDS Uniphase competes directly with Infinera Corp. and Ciena Corp.

In the wireless segment, the rapid growth of 4G super-fast LTE networks has significantly boosted JDS Uniphase's LTE test equipment and high-speed mobile back-haul network businesses.

The company has launched its customer experience assurance solutions called xSIGHT for LTE carriers which will enable them to access and analyze value-based data from a wide variety of sources.

Last year, the company also bought U.K-based privately-held Arieso, a leading provider of location-based intelligent software for global telecom networks. The newly-acquired technologies aim to deliver effective network design and performance by monitoring and optimizing radio access network (RAN).

Most notably, Arieso has a promising list of clientele that includes several global telecom giants, such as AT&T Inc. T, Telefonica S.A. TEF and Vodafone Group plc. VOD. JDS Uniphase currently has a Zacks Rank #3 (Hold).