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Infinera Corporation Message Board

  • byronangel byronangel May 29, 2013 9:27 AM Flag

    Societe Generale reiterates "Sell" rating on ALU

    Societe Generale has a $0.84 price target on the stock.

    I'm wondering if the decision by INFN to raise capital was "aimed" at ALU. INFN and ALU are now competing to supply 100G to Verizon, AT&T, and other Tier 1's. ALU has the advantage of incumbency but INFN has a better product and a much better balance sheet. There's substantial doubt about the ability of ALU to continue as a going concern. INFN on the other hand has a strong balance sheet, and they've just demonstrated that if they need more capital they can easily raise it. I'm wondering if INFN decided to raise more capital as a way of demonstrating to potential Tier 1 customers that they are financially sound whereas ALU is not. Maybe this capital raise will be the final step that convinces Verizon, AT&T, and others to dump ALU as a supplier and buy the DTN-X.
    Byron

    Sentiment: Strong Buy

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    • I wouldn't rule that out at all. I used to feel that about the only weakness INFN had was that it was not one of the 800 pound gorillas in the technology sector. Well, with technology recognized as years ahead of that of their competitors, a leading share in their market, and a rock solid balance sheet, a prospective customer has absolutely no cause for concern about buying from Infinera.

 
INFN
23.94+0.42(+1.79%)Jul 31 4:00 PMEDT