Here's a large parent from outside the technology industry who bought assets of Oplink optical company. Large corporations record high profit and cash this year are driving record high acquisitions. Is Zhone the next to be bought
Oplink Jumps 14% on Buyout by Koch Brothers; Here Comes Consolidation, Says RBC
Barrons Tech Trader Daily
November 19 2014 1:47 PM ET
Shares of fiber optics component maker Oplink Communications (OPLK) are up $2.93, or almost 14%, at $24.18, after the company this morning agreed to be bought by conglomerate Koch Industries, the privately held enterprise of the Koch family for $24.30 per share in cash or $411.5 million.
The deal is actually being carried out by a Koch subsidiary, Koch Optics Inc and Oplink will be managed by another subsidiary Molex, the connector maker that Koch acquired last December.
Molex’ head of business development Tim Ruff remarked that “Oplink will significantly expand Molex’s fiber optic capabilities for technology development and new product innovation.”
In a note to clients this afternoon Mark Sue of RBC Capital Markets thinks the deal is a sign of looming consolidation in optical:
We believe the entrance of a well-capitalized buyer from outside the traditional optical space changes dynamics and may increase the pace of industry consolidation that has been foreshadowed the past year [...] Current fab utilization rates remain low with over-capacity with optical component vendors unable to charge a premium for their innovation. Gross margins are currently weighed by competitive pressures with optical component makers willing to cut pricing to account for high fixed costs, weighing on overall industry profitability. Finisar (FNSR), we believe, may be a net consolidator of optical assets, while JDSU (JDSU) as well as smaller players like Oclaro may be net sellers of assets. A large well-capitalized competitor like Koch Industries could change industry dynamics turning once buyers into potential sellers.
WHY DOES CISCO KEEP LOSING MARKET SHARE ? CISCO CONTINUES TO MISS OR GUIDE DOWN.
CISCO OLD TECHNOLOGY IS DYING PER CNBC FAST MONEY SAID "THIS IS OLD TECH".
CHAMBERS NEEDS TO LEAVE.
Many technology companies in Wintel PC Servers Networking are BEATING+RAISING estimates....
I guess he's been busy meeting with Corning. Rock on Mr. CEO and give us your Sales Revenue Upside Guidance. That Corning partnership has significant potential !
FBN Charles Payne: Since 1942 Years ending in "5" Market is Up 25% Average and Years 5+6 Market is Up 37.6%....2015 Better GDP Jobs Energy. Cheaper Gas and Oil is Correlated 87% with Higher Corporate Profit.
CNBC Bob Piisani Video : Record Earnings, 9.7% Near-Record Margin, 39th SP High This Yr, Unemp fall. Nikkei Up on Delayed Tax, DR Horton Home Orders Up 38%
Art Cashin 40 Year Experienced Floor Trader on NYSE Provides These 4 Reasons the Bulls Will Win Out:
1. Seasonally Very Strong Months of Nov-Dec,
2. Year "5" Has Been Historically a Very Strong Year
3. Year Before Presidential Election is a Very Strong Year
4. Jobs Improving with Drives Hiring, CapEx, Retail, & Factories
CEO of Micron told Nikkei Asia news article they are expanding Japan DRAM and Flash Factories for a total of $4B this fiscal year to kep up with rising demand in phones, pcs, servers, etc where equipment unit demand is rising and memory GB / unit content demand is rising.
Tech Revenue Upcycle is beginning to move into a significant growth phase.
A month ago at the analyst conference Zhone's new CEO hinted at the growth Business Unit, new dedicated Business Unit leader, and Zhone company growth plan would be unveiled "later this month".
Has anyone seen this growth plan? Where is the CEO and his plan? He was hired to accelerate the company several months ago.
US Jobs Accelerating...Initial jobless claims down 10k to 278k in wK ended Nov1 is one of the lowest levels in 35 years. More jobs, higher retail, increased AMD revenue and profits.
Update on Market & Survey Statistics from Fox Business Channel Chalres Payne show, which quoted Strongly Bullish Historical patterns on Wall Street & This Stage of the Election Cycle:
* Wall Street Strategists Surveyed by Bank of America Shows 52% Going in Equities this means it is Very Undervalued. 96% Time That Has Happened the Market Went Up 25% Within 12 Months (Matt McCall on FBN Charles Payne show)
* In 17 of 18 of the Past Midterm Elections or 94% of Time the Market Has Gone Up 9% within 90 Days (Matt McCall on FBN Charles Payne)
This stimulates Asia GDP, WW GDP, and International Business Revenue Growth...
Bank of Japan Surprise Large Stimulus announced (see Bloomberg News)
Nikkei and Toppik Up 5%. Dow Premarket Up 200. Nasdaq Up 62.
Europe Austrian banker says "never say never" as Europe considering widening QE in their region.
Markets are becomming "un-stuck" as we begin the strongest months of the stock market year.
Risk on is coming.
EU Russia Ukraine signed Natural Gas Deal... (Reuters News Article on Bloomberg)
EU will move toward lifting sanctions.....Acceleration will then happen quickly.
Positive for ZHNE Overseas Business Growth
This from yahoo finance article:
The fourth quarter traditionally has been the strongest quarter of the year for U.S. stock markets. The arrival of November also marks the start of the strongest six months of the year. Investing in the in the Dow Jones Industrial Average in the fourth quarter since 1950, from November through April, earned investors an average 7.5%. They earned a mere 0.3% during the other six months of the year.
Based on my experience, the fourth-quarter rally tends to be even stronger in global (particularly emerging) markets as investors re position themselves ahead of the coming year.
Bellwether large companies usually beat first...then others follow. Leading Economic indicators suggest 4.5% says marketwatch site economist. Tech CapEx Recovery Begun indicated by MU INTC HPQ MSFT ACT etc. Nov-Dec strongest two months for stocks says Art Cashin based on market patterns for decades. AFOP Buy on dips.
We have the strongest GDP Growth the past six months (2 quarters period) since 2003 as reported by Joseph LaVorgna at Lavorgnanomics on twitter.
Economic acceleration elevates profitability and durable goods technology upcycle rate of recovery.
CNN Fear and Greed Index went into Upturn recently....that runs 3 months.
.MACD Technical indicator on the Daily Chart has turned positive for the following markets:
AAPL is approaching MACD turning positive. Also so are MU AMD ZHNE TXN and others