Nyquist Capital » AVNX

Optical Component Consolidation - Part I

Andrew Schmitt — Wed, 04 Jun 2008 21:47:19 +0000

Just as the market abandoned hope of consolidation it strikes. The dust has settled from the merger announcement between Finisar and Optium and in plain terms it is a brilliant move. Finisar is already a leader in the industry but this puts them in an even stronger position than before. This series of posts looks at why it is happening, who benefits, who loses, and suggests what is likely to happen next.

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Infinera - The Optical Component Company That Wasn’t

Andrew Schmitt — Fri, 08 Jun 2007 13:48:22 +0000

Infinera (INFN) had a very successful first day of trading after seven years of working counter to the popular and misguided beliefs of a Gilderesque all optical future.

Great controversy surrounds the company and investors wonder whether the valuation attached to company is justifiable. The valuation is indeed debatable and is predicated on their success penetrating the PTTs & Bellcos.

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OFC 2007 Exec Forum - Ten Things You Missed

Andrew Schmitt — Fri, 30 Mar 2007 21:19:41 +0000

Here’s a top 10 list of my most notable observations from the Executive Forum at the Optical Fiber Conference in Anaheim last Monday.

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Finisar FQ307 Earnings Commentary

Andrew Schmitt — Fri, 09 Mar 2007 14:20:19 +0000

Finisar (FNSR) reported revenue Monday evening of $107.5M. No written transcript of the call is available, though a replay is and the company overview was updated. I thought there were three notable announcements.

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Why JDSU Bought Picolight

Andrew Schmitt — Thu, 01 Mar 2007 03:09:44 +0000

JDSU (JDSU) announced that they are acquiring Picolight, a maker of VCSEL based optical transceivers. This is yet another example of healthy consolidation in the optical components business, which ultimately will lead to a better business environment for all- except for the customers like Cisco that exploit the oversupply situation. And Cisco is the likely reason JDSU bought Picolight in the first place.

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Dr. Strangelove, Or: How I Learned To Stop Worrying and Love Huawei.

Andrew Schmitt — Mon, 20 Nov 2006 20:05:35 +0000

I know two American engineers who have relocated to China to lead optical module design teams at Chinese equipment companies. They live and work in China for Chinese companies, using their skills to build custom modules - skills no longer in demand from their American Tier-1 telecom equipment employers.

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The End of Telecom As We Know It And I Feel Fine

Andrew Schmitt — Mon, 25 Sep 2006 19:18:01 +0000

Anyone know where the next ten-bagger investment is in the Telecom sector? Does anyone believe such an idea is even possible anymore?
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What’s Going On in Optical

Andrew Schmitt — Fri, 01 Sep 2006 14:43:29 +0000

OK, since I’ve been called out by Om Malik, I’m going to let rip with a stream-of-conciousness monologue on optical. No backspace key, no delete key, spelling corrections ex-post-facto. Here goes.

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Bookham, China, and the Optical Component Market

Andrew Schmitt — Tue, 23 May 2006 20:02:42 +0000

Recently, I sat down with Giorgio Anania, CEO of Bookham Technology (BKHM). We discussed a number of things, including the emerging competition of Asian optical component manufacturers. My conversation with him was about the industry in general, and not specific to Bookham.

We like to identify macro technology trends and disruptions then determine the best way (if any) to invest in them by following up with individual technical (as in technology, not charts) and financial analysis. Discussions with gentlemen like Giorgio Anania help me start this process. At this time I’m far from finishing it.

One trend I see unfolding is the emergence of Chinese optical component companies. Every company is moving their labor intensive component manufacturing to Asia (including Bookham) either through outsourced manufactuing or directly owned facilities in low-cost labor areas.
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Why I Don’t Own Optical Component Stocks (yet)

Andrew Schmitt — Mon, 22 May 2006 14:51:10 +0000

A common question I receive is “What optical component equities do you like”.

My answer is pretty simple.
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