re: Broadband Stimulus: How Much?It seems that Occam will be a big winner. And they certainly seem to be doing more than O.K. under some difficult economic conditions. $2 per share in cash, no debt, non-GAAP breakeven last quarter, significant revenue growth over the last few quarters, the Tier I Fairpoint contract and now almost $7B in stimulus spending directed squarely at their customer base.
re: Broadband Stimulus: How Much?Maybe they will come out okay.
Occam has already been thro VC money and public stock money and STILL struggles to keep its head above water.
Granted it is a MDLC player like CowLicks but it has lost its way slightly. maybe they are the next Pannaway. In any case I thought they manufactured and moved a lot of R&D into China ?
re: Broadband Stimulus: How Much? Looks like Occam has laid off enough folks to get to break even, but they don't have an effective growth strategy. Calix has done well with GPON in the IOCs where Occam is nowhere in that business.
Will they do well with this? We shall see. They have virtually no Tier 2 business and it is not clear that the Mom and Pops can actually do much with this money.
re: Broadband Stimulus: How Much?"the Tier I Fairpoint contract"
Fairpoint is tier 1? I thought they were a rural carrier almost by definition (that's their business model). And aren't they high debt from buying all these other little carriers, including Verizon's rural New England cast off?
re: Broadband Stimulus: How Much?1) Occam has added 70 employees in the last year increasing the headcount by over 40% in that timeframe (28-30 from Terawave acquisition). I believe the revenue growth over the last few quarters is the reason for breakeven.
2)Calix inherited OSI's hugh N.A. PON customer base after the acquisition. Kudos to Calix for that move. Occam has only had a G-PON solution out for 8 months after concentrating on active ethernet for some time. I think their entry into G-PON, while no real threat to drive out Calix, can only add to their revenue base.
3) According to Occam's website they count 9 of the 17 North American Tier 2 carriers as their customers.
re: Broadband Stimulus: How Much?Fairpoint is tier 2. It won't make much of an impact on Cisco's business, but it is a pretty big big contract for Occam.
FRP has a high debt load for one reason, which is that as a 300k line operation they went out and bought 1.5mm lines from VZ financed by debt. FRP is in so-so financial position, but I have to think they will reap a windfall from the stimulus plan. They are doing exactly what Obama wants them to do, and i would have to think they would get significant government funding that would help alleviate their debt and cash flow burden.
In either case, it is worthwhile noting that most of FRP's spending for the VZ properties is conractual in nature as they had to promise certain amounts of spending to the state PUCs.
The Pannaway comparison is not at all apt. If you ignore the stock, which is having trouble keeping its head above water, the company is doing quite well, and annualizing at $100mm run rate in revenues. The stock is extraordinarily depressed, but that is the point of the article... it's an opportunity.
re: Broadband Stimulus: How Much?The Technology Opportunities Program is not "brand spanking new." It was created and active from 1994 - 2004, at which time its funding was elminated. See http://www.ntia.doc.gov/otiaho.... Admittedly, as a practical matter it may be like starting over.
That doesn't sound like a Pannaway to me.