6 Takeaways From Mobile World Congress Day 3
Analysts at Citi Research have been attending the Mobile World Congress in Spain this week. Here is a list of analysts' six takeaways from day three of the congress.
1. According to Ericsson (NASDAQ: ERIC) CEO Jan Frykhammar, the company plans to keep opex flat year-over-year (Y/Y) in 2015.
The company intends to ramp-down spending in the second half of the year to balance out large cloud and IP-related spending in the first half of the year.
2. Frykhammar projects little Y/Y change in business mix of coverage versus capacity in 2015, hinting that gross margins will likely also be flat Y/Y for Ericsson. He expects an eventual rise in margins from the new mix, but that rise may not come into play until 2016-2017.
Analyst do not believe this win is dependent on the timing of Comcast's deal with Time Warner Cable Inc (NYSE: TWC).
4. According to Ruckus CEO Salina Lo, Hewlett-Packard Co (NYSE: HPQ)'s proposed acquisition of Aruba Networks Inc (NASDAQ: ARUN) would be a net positive for Ruckus in the long-term. HP's switching business competes with many Aruba partners, such as Juniper Networks Inc (NYSE: JNPR), Brocade Communications Systems (NASDAQ: BRCD) and Dimension Data (NYSE: NTT).
Lo believes this conflict of interest could drive partners toward Ruckus.
5. F5 Networks Inc (NASDAQ: FFIV) has seen a strong "create rate" lately for million dollar-plus deals.
6. F5 CEO John McAdam described the company's partnership with Cisco Systems Inc (NASDAQ: CSCO) as "working really well."
F5 is seeing strong pull-through demand resulting from its partnerships with both Cisco and VMWare Inc (NYSE: VMW).
Latest Ratings for ERIC
|Oct 2016||JP Morgan||Downgrades||Overweight||Neutral|
|Sep 2016||Credit Suisse||Upgrades||Underperform||Neutral|
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