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Analyst Blog

On Mar 12, 2014, we issued an updated research report on JDS Uniphase Corp. (JDSU - Analyst Report). The company improved its year-over-year performance on strong contributions from its Internetworking and Broadband Access product divisions.

The results were supported by an improved spending atmosphere and increased strategic investment by its carrier and enterprise customers. Also, the company’s international business generated record high revenues.

JDS Uniphase has delivered only one positive earnings surprise in the last year, with an average beat of negative 4.17%. However, the company reported better financial results for the fourth quarter of fiscal 2013 with both the top and the bottom line missing the Zacks Consensus Estimate.

JDS Uniphase’s newly-launched products coupled with the acquisition of Trendium, Network Instruments and Arieso are the long-term positives for the company. Moreover, higher Internet usage and associated applications have spurred demand for components and modules used in 3G/4G high-speed communication networks, benefiting JDSU in the long run.

However, on the downside, the ongoing global economic fluctuations may significantly affect the prospects of JDS Uniphase. Moreover, the consolidation trend of wireless networks and data centers will worsen the situation. Meanwhile, the stock price is fairly valued at current levels and is trading at the high-end of a 52-week high.

JDS Uniphase currently carries a Zacks Rank #3 (Hold).

Stocks That Warrant a Look

Other better-ranked stocks that belong to the sector include ClearOne, Inc. (CLRO - Snapshot Report), Plantronics, Inc. (PLT - Snapshot Report) and Alcatel-Lucent (ALU - Analyst Report). Currently, ClearOne and Plantronics have a Zacks Rank #2 (Buy) while Alcatel has a Zacks Rank #3 (Hold).

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