While optimistic for the long term I don't see how they can have a really strong Q3 since 40G is tailing off now and most of last year Q3 was 40G sales. They stated clearly they don't expect the big 100G ramp until the new chipsets are available in quantity and they did not expect that until later this year. Without a significant 100G contribution they would seem to almost be guaranteed a flat to negative revenue quarter for Q3. If they guide Q3 flat or negative in the August call it is virtually guaranteed this stock will be in the $8's again. I don't doubt the longer term picture, just think it will be very hard to see big revenue growth in Q3. I'm sure the director knows the stock is worth a lot more than the $10 he paid for it but the market won't care how many insiders buy if they guide Q3 down. Just my opinion but I am being cautious here in the transition period from 40G to 100G.
I'm thinking even Q3 could be weak because of the delays in the Tomahawk chipsets that supposedly won't be out until then. The lack of those chipsets in quantity is the logjam for 100G to really start breaking out. I'm keeping dry powder for weak Q3 guidance - I will not be surprised to see the stock in the $8's again before a sustainable real move up begins. I do think 2017 will be a big year with 100G really kicking in and the Docsis 3.1 upgrades well underway as well. Until 100G really picks up it is hard to see much sales growth with 40G on the decline. They have geared the operation to 100G so that really has to materialize and a lot of it is not in their control since they are dependent on the chipsets and other infrastructure required. The next couple of quarters can definitely be dicey in my opinion. 2017-2019 story should be very compelling so I am holding my core position and will buy more if we get a big drop on light Q3 guidance when Q2 report comes in August..