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optical posts

Global Crossing's results support the return of IP optical networks

Posted Mar 16th 2007 12:04PM by Eric Buscemi (RSS feed)
Filed under: Industry

Global Crossing Ltd (NASDAQ: GLBC) rallied strongly yesterday, jumping almost 10% to $29 per share.

Global's results support our investment thesis of staying focused on the re-emergence of IP networks.

As a reminder, the price-performance curve of these networks is vastly superior to the old-time circuit-switched networks. This means as video and data intensive applications such as MySpace and YouTube continue to ramp, the demand for IP traffic will go through the roof -- as will the profits of the IP service providers like Global Crossing.

This Fly began positively blogging about Global's turnaround when the stock was trading at$14.50 last summer. Global's stock is now up 100%. I'd stay with this stock, there is more money to be made.

Optical IPOs slowly coming back

Posted Feb 12th 2007 7:45AM by Eric Buscemi (RSS feed)
Filed under: Forecasts, Good news, Industry

Opnext, a maker of laser diodes, optical modules and pluggable modules, is expected to go public this week, and will trade under the symbol OPXT. Opnext is the second optical component company to come public in the last four months. Optium Corporation (NASDAQ: OPTM), a Chalfont, Pa-based company, came public in October 2006 at $17.50 and is now trading at $24.95.

Opnext has been funded by Hitachi and venture capital firm Clarity Group. Hitachi will be transferring some 670 patents to this start up.

The stock is supposedly going to be priced around $14 per share. With only two optical companies recently coming public, as one would expect, the financials for the company are pretty solid.

Supposedly, Opnext is strong in the 10-Gigabyte optical space and also has product for 40 gigabyte technology.

These optical components are very cyclical, as are most new higher growth industries. The upcycle in this space appears to be still in its early stage. It may be worth a spec on this IPO.