Market Overview

William Blair: Reports Of Apple-Related Problems At Finisar 'Profoundly Inaccurate'

Share:
William Blair: Reports Of Apple-Related Problems At Finisar 'Profoundly Inaccurate'
Related FNSR
Benzinga's Top Upgrades, Downgrades For December 6, 2018
Earnings Scheduled For December 3, 2018

After falling 30 percent since its March 8 third-quarter report, Finisar Corporation (NASDAQ: FNSR) represents an opportunity for investors, according to William Blair.

The Analyst

William Blair's Dmitry Netis maintains an Outperform rating on Finisar's stock with no assigned price target.

The Thesis

Finisar's stock has underperformed the broader market "significantly" amid multiple concerning headlines in recent months, Netis said in a Thursday note. But this may be unjustified, as one of the more notable headlines impacting the stock is inaccurate, the analyst said. 

BlueFin Research said in a research report that Finisar is encountering "major difficulties" in finding a 6-inch equipment set to supply Apple Inc. (NASDAQ: AAPL), which "opened a window" for II-VI, Inc. (NASDAQ: IIVI).

This line of thinking is "profoundly inaccurate," Netis said, as II-VI is likely ramping a low-powered VCSEL that Finisar doesn't manufacturer in the first place.

"Finisar, at Apple's request, has been focused on high-powered VCSELs out of its 4-inch Allen, Texas fab, which, while having limited capacity, continues to ramp up at an accelerated pace and is seeing improved yields," the analyst said. 

Finisar has already said the number of VCSELs it will ship this fall will be "meaningfully higher" than one year ago, Netis said. 

Apple CEO Tim Cook's upcoming TV interview "Revolution: Apple Changing The World" on April 6 should "underscore Apple's intention" to build Face ID modules in Texas, according to William Blair. 

Price Action

Shares of Finisar were up 6.26 percent at $15.62 at the close Thursday. 

Related Links:

The Effect Of iPhone X Churn On Component Suppliers: BlueFin Research Identifies Winners, Losers

Wall Street Debates: Should Finisar Investors Buy The Dip?

Photo courtesy of Apple. 

Latest Ratings for FNSR

DateFirmActionFromTo
Dec 2018JefferiesDowngradesBuyHold
Dec 2018MKM PartnersDowngradesBuyNeutral
Dec 2018Morgan StanleyMaintainsEqual-WeightEqual-Weight

View More Analyst Ratings for FNSR
View the Latest Analyst Ratings

Posted-In: Dmitry Netis optical Optical Stocks VCSEL William BlairAnalyst Color Reiteration Analyst Ratings Best of Benzinga

 

Related Articles (AAPL + FNSR)

View Comments and Join the Discussion!

Latest Ratings

StockFirmActionPT
SIXKeyBancDowngrades0.0
CBBMorgan StanleyUpgrades10.0
GDCredit SuisseDowngrades184.0
GEOJP MorganDowngrades26.0
TRUERBC CapitalDowngrades0.0
View the Latest Analytics Ratings
Don't Miss Out!
Join Our Newsletter
Subscribe to:
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Fintech Focus
Your weekly roundup of hot topics in the exciting world of fintech.
Thank You
for registering for Benzinga’s newsletters and alerts.
• The Daily Analysts Ratings email will be received daily between 7am and 10am.
• The Market in 5 Minutes email will be received daily between 7am and 8am.
• The Fintech Focus email will be received every Friday between 2pm and 5pm.

Tiffany Management Convinces Analysts It's Getting Polished

Vetr Crowd Downgrades Blackberry