Needham says Louisiana became the first state broadband office to reveal preliminary data of its Broadband Equity Access and Deployment Program subgrantee results on Monday. Notably, $748M of the $1.36B will be spent on residential broadband deployments while another $500M will go towards “non-deployment” activities such as healthcare, education, and economic and workforce development, the analyst tells investors in a research note. The firm adds that of the broadband deployment funds, 95% will go towards fiber connections while less than 3% will go towards satellite, with 70% of the funds going to local Louisiana-based operators. Needham views the Louisiana award allocation results as “very positive” for Calix (CALX) and Clearfield (CLFD), noting each have dominant share in the U.S. rural and tier 3 operator segment. While investor fears for the future of BEAD have pushed both stocks down 28% over the past month, Needham continues to see no rationale that BEAD will be canceled by a new administration and Congress, rather only a higher likelihood of delays that push material spending into 2026, in-line with most supplier and its own expectations. In fact, the firm suspects the Trump administration is likely to remove regulations and oversight for BEAD, making the grants more attractive to operators.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
