JDS Uniphase to Buy Back $100M Shares - Analyst Blog

The board of directors of JDS Uniphase Corp. JDSU – a leading provider of communications test and measurement solutions – has approved a share repurchase program of up to $100 million through open market or private transactions.

The buyback will commence with immediate effect and needs to be completed before Jun 27, 2015. JDS Uniphase further stated that the number and timing of the share repurchase will be determined by the company's business and financial market conditions at any given point of time.

This decision reflects management's confidence in the company's growth prospects. According to JDS Uniphase, positive operating cash flow achieved consistently in the last 30 quarters amid a fluctuating macroeconomic environment backs the company's resolution to enhance shareholder wealth. A robust balance sheet coupled with management's expectation of healthy cash flow generation in the upcoming quarters further reinforces the buyback decision.

In the recently concluded quarter, the company reported mixed financial numbers with its bottom line surpassing the Zacks Consensus Estimate but revenues missing the same. Quarterly net revenue came in at $418 million, up 3.1% year over year but  fell short of the Zacks Consensus Estimate of $432 million. Quarterly adjusted earnings per share of 6 cents, however, outpaced the Zacks Consensus Estimate of 4 cents.

JDS Uniphase generated $42.5 million of cash from operations in the reported quarter. At the end of the third quarter of fiscal 2014, JDS Uniphase had $894.8 million of cash & marketable securities and $530.2 million of outstanding debt on its balance sheet compared with $486.2 million of cash & marketable securities and no outstanding debt at the end of fiscal 2013.

Other Stocks to Consider

JDS Uniphase currently has a Zacks Rank #3 (Hold). Some better-ranked stocks in the communications component manufacturing industry are ShoreTel, Inc. SHOR, Harmonic Inc. HLIT and Premiere Global Services Inc. PGI. ShoreTel sports a Zacks Rank #1 (Strong Buy), whereas Harmonic and Premiere Global Services hold a Zacks Rank #2 (Buy).

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