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OPLK - (recommended
to subscribers on 10/30/05)
BOUGHT
at $10.50 SOLD
at $16.63
On October
27th 2005 Oplink Communications Incorporated, a provider of optical
subsystems and components to telecom and cable T.V. equipment
manufacturers, reported fiscal 1st quarter 2006 revenue of $10.7
million. This was up 20% from the $8.9 million reported in the 1st
quarter of fiscal 2005. Revenue was also up 20% on a sequential basis
and was ahead of the consensus estimate by 15%. This quarter marked the
first significant revenue growth for the company in approximately 2
years. Earnings per share in the 1st fiscal quarter were 0 cents which
compares to earnings per share of -1 cent in the year ago period.
The CEO said that growth came from increasing demand for it's
components
and subsystems from several customers and he also said that the company
is having success at winning market share from competitors.
For the fiscal 2nd quarter of 2006 Oplink said
that it expects revenue growth of approximately 10% on a sequential
basis. This would represent revenue growth of 45% when compared to the
fiscal 2nd quarter of the prior year. Operating expenses are expected
to be flat while gross margins and net income are expected to improve. During
it's earnings conference call the
company said that in coming quarters it expects more business from
customers such as Tellabs, Lucent, and Cisco.
Oplink has cash and investments worth $187.6
million or $1.26 per share. Book value is $1.48 and the company carries
no debt. At the current price the stock has a price-to-sales ratio of
approximately 6 and a price-to-book ratio of just 1.
1/17/06 - SOLD AT $16.63 FOR A GAIN OF
58%. DURING THE SAME TIME PERIOD
THE NASDAQ WAS UP 11%.
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