UPDATE: Morgan Stanley Reiterates Overweight For Finisar On Surging Datacom

In a report published on Thursday Morgan Stanley analyst Ehud Gelblum reiterated the rating on

with an Overweight and $18 PT. In the report Morgan Stanley commented, "he higher-margin Datacom business drove revenue (and GM), up 11% q/q to 67% of rev from 62% in FQ3. Upside came from 10GigE transceivers for switch/server attach and 16G FC, along with 100G CFP for routers. A surprising 12% q/q decline in Telecom revenue, however, wiped out the datacom upside, missing flat-to-down guidance, and we believe potentially reflecting some weakness at customer ALU, and since the next build cycle has yet to begin. WSS & ROADM line cards were flat q/q, while Tunable-XFPs fell ~10% q/q, reversing what was strong 30% q/q growth in FQ3." Finisar Closed on Wednesday at $14.52