Oplink Communications Inc.
) has posted an average earnings surprise of 113.5% over the past
four quarters, most recently delivering a beat of 160% in its
fourth quarter of 2012. This optical networking solutions provider
achieved a Zacks #1 Rank (Strong Buy) on September 1.
Oplink Tops in Q4
On August 16, 2012, Oplink Communications reported fourth quarter
2012 earnings of 13 cents per share, well above the Zacks Consensus
Estimate of 5 cents. Revenue increased 1.3% year over year to $44.2
million, in line with the Zacks Consensus Estimate.
However, operating profit declined 3.9% year over year to $3.4
million, primarily due to higher sales & marketing expense (up
9.6%) and general & administrative expense (up 7.6%).
Oplink Communications provided a stable outlook for the upcoming
first quarter of 2013. Revenue is expected between $43.0 million
and $46.0 million. Earnings are seen at 16 cents to 22 cents per
Operating expenses are expected to increase in the first quarter
due to higher research & development spending and sales &
Earnings Estimates Move Higher
Earnings estimates moved higher over the last 30 days. For 2013,
the Zacks Consensus Estimate jumped 24.4% to 56 cents, representing
a 94.3% year-over-year growth. For 2014, the Zacks Consensus
Estimate stands at 81 cents, reflecting year-over-year growth of
Currently, Oplink Communications is trading at a premium to most of
its peers based on P/E and P/S. Its price to book ratio of 1.13 is
at a discount to the peer group median of 1.62. Given the strong
earnings growth prospects over the next couple of years, the stock
is reasonably valued.
Incorporated in 2000, Oplink Communications provides optical
networking solutions. The company has more than 350 products that
cater to all segments of fiber optic network infrastructure,
including long-haul networks, metropolitan area networks ("MANs"),
local area networks ("LANs"), wireless backhaul and
fiber-to-the-home ("FTTH") networks.
Fremont, California-based Oplink Communications has a market cap of
$311.51 million. The company has a clientele of more than 525
companies globally, which includes customers from
telecommunications, data communications and cable TV equipment
verticals. It competes with a number of companies, including Avago
) and JDS Uniphase Corp. (
OPLINK COMMNCTN (OPLK): Free Stock Analysis
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