J.P. Morgan Initiates Infinera Coverage With An OW Rating, $12 PT

J.P. Morgan has initiated coverage on Infinera Corporation

with an Overweight rating and a $12 December 2011 price target. “Infinera offers investors a pure play on the rapidly growing optical transport market,” J.P. Morgan writes. “In addition to this, the company's proprietary photonic integrated circuit (

) chip architecture makes it likely, in our opinion, that INFN continues to close the gap between its estimated 37% N. American share in long haul optical and much lower share positions elsewhere.” J.P. Morgan said that it sees some potential for volatility in early 2011 prior to 100G launch but believe this risk is mitigated by strong optical purchasing trends and the potential for 100G driven share gains in late 2011. Infinera closed Wednesday at $10.16.