FCC Adds To School Wi-Fi Spending; Pacific Crest Views Aerohive As 'Well Positioned'

Federal plans to funnel more than $7 billion into equipping public schools with Internet connections is likely to benefit at least three publicly traded companies, one analyst said Thursday.

The Federal Communications Commission voted 3-2 along party lines last month to revamp its so-called E-Rates program, adding $5 billion to an existing $2.4 billion in funding to be spent by underprivileged schools over the next six years.

Aerohive Networks HIVE "is best positioned" to get a piece of that action according to Pacific Crest's Ryan Hutchinson, who also cited Aruba Networks ARUN and Ruckus Wireless RKUS.

Hutchinson maintains and Overweight rating on all three stocks.

Fast-growing Aerohive gets about half its revenue from the K-12 and higher education markets and has completed deals with some of the largest U.S. school districts in the past quarter, Hutchinson said.

Aruba and Ruckus each get about 15 percent of revenue from education markets, but each "stand to reap significant benefits" from the expanded government spending, Hutchinson said.

Only "marginal" business will accrue through the program to Cisco Systems CSCO and NetGear NTGR, Hutchinson said.

Aerohive traded recently at $7.93, down 0.6 percent; Aruba and Ruckus were nearly unchanged at $21.24 and $14.02, respectively.