Looks like CIEN and INFN will have most of the market outside China
MKM Partners analyst Michael Genovese is out with some interesting comments today. According to Genovese, AT&T's revised capex plan shows increased confidence AT&T will start a 100G optical network build in 2014. "Our checks tell us that AT&T will likely turn its attention to 100G optical after nationwide LTE coverage is done," the analyst said. "Accelerated LTE coverage gives us more confidence AT&T will begin 100G in earnest in 2014."
"According to our checks, Ciena and Infinera are soundly beating Alcatel-Lucent in the North American terrestrial market and in underseas optical," Genovese said. "We think this is the primary reason ALU performed poorly in these areas in 1Q13."
To me it's looking more and more like CIEN and INFN will have most of the optical networking business outside of China. All of the major players are going to want to have 2 suppliers and in most cases I think it will be CIEN and INFN. ALU is fading away. Huawei will never be able to escape their ties to Chinese Military Intelligence. Nokia Siemens and Ericcson are focusing on other areas. INFN now has a PIC base Metro product in development. Once this rolls out, they expect their total addressable market to increase to $15 billion. I think they could easily capture a third of this. With $5 billion in sales and assuming a price to sales ratio of 2, this would be a $75 stock.
When you say companies will want to have two vendors. I agree companies like to do that but isn't that somewhat difficult due to INFN's different architecture compared to the conventional one used by a company like CIEN.
After all, that is one of the main selling points of INFN.
This would be $75.00 stock ...byron , great ..You are amazing day dreamer.... You are good at posting technical aspects of this stock..But for INFN to move from less than 1 billion market cap to $15 billion is just a joke ...Just a mockery of math and reality..They are not even giving $150 million revenue and byron is talking about $15 billion market cap....Hope you come back to realistic world soon...