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Optical components

The Weight of Infinera

2:15 PM -- Could the Infinera IPO drag optical components down even further?

It's possible, if Infinera tanks. Wall Street tends to group companies in buckets, and a few sources around optical think Infinera -- which, yes, sells systems -- could color the thinking around optical component IPOs.

We already know MRV Communications Inc. (Nasdaq: MRVC) plans to spin off LuminentOIC Inc. as a public company. (See MRV Buys Fiberxon, Preps IPO.) And, like rookies in the minors, NeoPhotonics Corp. (NYSE: NPTN) and Santur Corp. are said to be waiting their turn at bat for IPOs.

But the optical sector hasn't done much to gain Wall Street's favor lately. Recent IPO filers, IPG Photonics Corp. (Nasdaq: IPGP), Optium Corp. (Nasdaq: OPTM), and Opnext Inc. (Nasdaq: OPXT), got off to good starts but have been gliding downward.

Table 1: Optical IPOs: Down to Earth
IPO Date IPO price Closing Price,
Day One
Closing Price,
May 23, 2007
Optium Oct. 26, 2006 $17.50
$19.60
$15.66
IPG Dec. 13, 2006 $16.50
$25.60
$21.61
Opnext Feb. 16, 2007 $15.00
$17.89
$10.71
Source: Company SEC filings, FinancialContent Inc.




It hasn't helped, either, that market king JDSU (Nasdaq: JDSU; Toronto: JDU) stumbled last quarter and might even want out of the business. (See JDSU Regresses in Q3 and JDSU May Be Mulling Optical Exit.)

Maybe I should stop being so gloomy and ask the question the optimistic way: Could a successful Infinera IPO lift the optical sector?

— Craig Matsumoto, West Coast Editor, Light Reading

Stevery 12/5/2012 | 3:07:57 PM
re: The Weight of Infinera
Here is the The Mysterious Secret to a long-term successful IPO:

Build a profitable company.

Anything else is just unloading your bad investment onto the public. (Sure you can do that, but do you want that to be your legacy?)
rjmcmahon 12/5/2012 | 3:07:56 PM
re: The Weight of Infinera "Some of them hated the mathematics that drove them, and some were afraid, and some worshipped the mathematics because it provided a refuge from thought and from feeling. If a bank or a finance company owned the land, the owner man said, The BankGÇöor the CompanyGÇöneedsGÇöwantsGÇöinsistsGÇömust haveGÇöas though the Bank or the Company were a monster, with thought and feeling, which had ensnared them. These last would take no responsibility for the banks or the companies because they were men and slaves, while the banks were machines and masters all at the same time. Some of the owner men were a little proud to be slaves to such cold and powerful masters."

...

"Sure," cried the tenant men, "but itGÇÖs our land. We measured it and broke it up. We were born on it, and we got killed on it, died on it. Even if itGÇÖs no good, itGÇÖs still ours. ThatGÇÖs what makes it oursGÇöbeing born on it, working it, dying on it. That makes ownership, not a paper with numbers on it."

"WeGÇÖre sorry. ItGÇÖs not us. ItGÇÖs the monster. The bank isnGÇÖt like a man."

"Yes, but the bank is only made of men."

"No, youGÇÖre wrong thereGÇöquite wrong there. The bank is something else than men. It happens that every man in a bank hates what the bank does, and yet the bank does it.

The bank is something more than men, I tell you. ItGÇÖs the monster. Men made it, but they canGÇÖt control it."

The tenants cried, "Grampa killed Indians, Pa killed snakes for the land. Maybe we can kill banksGÇöthey're worse than Indians and snakes. Maybe we got to fight to keep our land, like Pa and Granpa did."

And now the owner men grew angry. "YouGÇÖll have to go."
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