From Briefing.com....... Not a lot of action here recently, but for those who are interested here goes.......Trader's Edge: Harmonic (HLIT)
26-Nov-01 09:45 ET
[BRIEFING.COM - Robert J. Reid] This broadband equipment maker looks like a good trade heading into the Western Cable Show later this week as it could announce a key customer win and new products.
Background
Harmonic (HLIT 10.55 -0.03) supplies broadband solutions for the cable, satellite, broadcast and telecom industries. The company has been a leader in the development of several broadband technologies, including video compression, gigabit Ethernet switching and fiber to the curb architectures.
Key Points
AT&T Broadband: Briefing.com sources tell us that AT&T Broadband is in trials to select Harmonic as its video-on-demand server vendor and the digital cable tv giant is using Harmonic's NSG (Narrowcast Server Gateways) product in all of the trials.
Western Cable Show: Sources also tell us that Harmonic will announce at the Western Cable Show (Nov 28-30) that either Comcast or Charter is deploying its NSG product.
New Products: Also, at the Western Cable Show, Harmonic is expected to introduce some impressive new products and could even report a turn in its transmission business.
Gigabit Ethernet: Harmonic has been a strong player in gigabit Ethernet switching products for cable operators, which allows customers to offer businesses and high end residential subscribers T1-type services. This should be another focal point of the Western Cable Show this week. Harmonic recently initiated a trial of its new CURBswitch product for a fiber-to-the-curb network at a major cable operator and is aggressively pushing for trials with other potential customers.
Recent Deals Show Signs of Life: A number of recent deals in the cable equipment sector is an indication that the outlook for the sector is improving. Over just the last two weeks, a number of deals have been announced: Motorola is buying Synchronous, Juniper is buying Pacific Broadband, Scientific-Atlanta is buying BarcoNet.
Risks: When it reported in late Oct, Harmonic gave disappointing guidance. Revenue for the next two quarters are projected to be flat. Also, the company's cash position of $54 mln, could be better. DecQ burn rate should be $7-$10 mln.
Bottom Line: HLIT looks like a good trade heading into the Cable Show later this week as it should be a positive expo for the company, especially if it can announce a new deal. With a stop loss at $9 and a possible move to $14, it makes an attractive short term trade.
Good things come to those who wait. I hope. :-) |
