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Optical/IP

Finisar Woos Wall Street

For the second time in the span of a week, Wall Street analysts have smiled on Finisar Corp. (Nasdaq: FNSR), sending the company’s shares up slightly in midday trading.

Finisar shares were trading at $14.25 midday, up 6.5 percent from the start of the session, as the broader market is trending downward.

Needham & Co. today upgraded Finisar to a Buy from a Hold, citing improving market conditions for IT spending in general as well as new opportunities for Finisar to gain share in optical transceivers.

Just last week, Finisar was upgraded to a Buy from a Hold by Credit Suisse First Boston (see Finisar Flies on CSFB Upgrade). CSFB said Finisar has an impressive backlog of orders through April.

Mark Langley, a principal analyst at Needham, says the main reason behind the upgrade is that he sees a spending uptick in the overall SAN sector through 2002. More specifically, he notes that Finisar has a new opportunity to sell components to IBM Corp. (NYSE: IBM), since IBM’s optical transceiver business was bought in December by JDS Uniphase Inc. (Nasdaq: JDSU; Toronto: JDU) (see JDSU's Bid for the Enterprise).

“It’s possible they could start to sell to IBM, because [the optical transceiver unit] was captive under IBM,” Langley says.

He also says Finisar has just started to penetrate two major accounts, Cisco Systems Inc. (Nasdaq: CSCO) and McData Corp. (Nasdaq: MCDT).

— Todd Spangler, Senior Editor, Byte and Switch
http://www.byteandswitch.com

HarryPotter 12/4/2012 | 11:04:45 PM
re: Finisar Woos Wall Street FNSR has no major 2gig design wins at any of the OEMs. STLW has won a majority of the MCDT and CSCO business. FNSR is toast in 6 months.
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