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Ubiquiti Versus ViaSat: Facts, Figures and Growth Prospects
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Wireless equipment player, UbiquitiNetworks, Inc.’s shares have charted an impressive trajectory in recent times, having appreciated 41% in just the last six months. This is in stark contrast to that of its peer – ViaSat Inc. (VSAT - Free Report) – whose share price declined 2.4% over the same time frame.
In fact, Ubiquiti has strongly outperformed the Zacks categorized Wireless Equipment industry's return as well, which has gone up 11.4% in the same time period.
The company’s prospects look quite robust now, as indicated by its Zacks Rank #1 (Strong Buy). Also, Ubiquiti has been witnessing solid activity on the earnings estimate revision front. Analysts have become increasingly bullish on the stock, as the Zacks Consensus Estimate for fiscal 2017 earnings has trended up sharply in the past couple of months, from $2.66 to $2.96.
In fact, analysts have been turning bullish for ViaSat as well, lately. Analysts clearly expect good things in the company’s near future, as they revised 2017 earnings estimates upward from 6 cents a share 60 days ago, to 40 cents now.
However, Ubiquiti easily trumps ViaSat, when it comes to reported earnings performance. Ubiquiti has had a remarkable earnings surprise history in recent times, having beaten estimates consecutively six times in a row and has surpassed earnings estimates by an average of 19.7% for the trailing four quarters. In contrast, ViaSat managed two beats for as many misses over the trailing four quarters.
Ubiquiti has numerous catalysts working in its favor and these factors make us optimistic about its growth in the near term. The company enjoys a sturdy position in the wireless broadband market and its foothold in the enterprise WLAN access point markets is also strengthening.
Particularly, the company is enjoying solid growth momentum in its Enterprise Technology segment, driven by its highly successful UniFi products. In addition to strong product demand, Ubiquiti’s incessant product innovation drive and string of successful launches will likely be major drivers of top-line growth.
Coming to ViaSat, the company is enjoying steady growth in government and commercial air, in-flight Internet services and mobile broadband end markets. However, persistent weakness in the Commercial Networks segment, due to soft sales of large integrated antenna systems programs, has been hurting the company’s financials.
The company has grand expansion plans for its ViaSat-2 and ViaSat-3 satellites, which promise tremendous growth potential over the long run. However, its huge research and development expenses may cast a material impact on its margins and bottom line in the times ahead. Thus, the company’s prospects, though bright, remain vulnerable to operational headwinds.
We believe that if an investor seeks a position in this industry, then Ubiquiti – with a dominant industry position and favorable business trends – presents an interesting investment proposition right now.
Aspen Technology deals in process optimization software and services. It boasts a remarkable average surprise of 23.6% over the trailing four quarters, having surpassed estimates strongly in each of them.
Guidance Software, an industry leader in digital investigative solutions, also has an impressive earnings history. The company has beaten estimates in all the four trailing quarters, with an average surprise of 18.6%.
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Ubiquiti Versus ViaSat: Facts, Figures and Growth Prospects
Wireless equipment player, UbiquitiNetworks, Inc.’s shares have charted an impressive trajectory in recent times, having appreciated 41% in just the last six months. This is in stark contrast to that of its peer – ViaSat Inc. (VSAT - Free Report) – whose share price declined 2.4% over the same time frame.
In fact, Ubiquiti has strongly outperformed the Zacks categorized Wireless Equipment industry's return as well, which has gone up 11.4% in the same time period.
The company’s prospects look quite robust now, as indicated by its Zacks Rank #1 (Strong Buy). Also, Ubiquiti has been witnessing solid activity on the earnings estimate revision front. Analysts have become increasingly bullish on the stock, as the Zacks Consensus Estimate for fiscal 2017 earnings has trended up sharply in the past couple of months, from $2.66 to $2.96.
In fact, analysts have been turning bullish for ViaSat as well, lately. Analysts clearly expect good things in the company’s near future, as they revised 2017 earnings estimates upward from 6 cents a share 60 days ago, to 40 cents now.
However, Ubiquiti easily trumps ViaSat, when it comes to reported earnings performance. Ubiquiti has had a remarkable earnings surprise history in recent times, having beaten estimates consecutively six times in a row and has surpassed earnings estimates by an average of 19.7% for the trailing four quarters. In contrast, ViaSat managed two beats for as many misses over the trailing four quarters.
Ubiquiti has numerous catalysts working in its favor and these factors make us optimistic about its growth in the near term. The company enjoys a sturdy position in the wireless broadband market and its foothold in the enterprise WLAN access point markets is also strengthening.
Particularly, the company is enjoying solid growth momentum in its Enterprise Technology segment, driven by its highly successful UniFi products. In addition to strong product demand, Ubiquiti’s incessant product innovation drive and string of successful launches will likely be major drivers of top-line growth.
Coming to ViaSat, the company is enjoying steady growth in government and commercial air, in-flight Internet services and mobile broadband end markets. However, persistent weakness in the Commercial Networks segment, due to soft sales of large integrated antenna systems programs, has been hurting the company’s financials.
The company has grand expansion plans for its ViaSat-2 and ViaSat-3 satellites, which promise tremendous growth potential over the long run. However, its huge research and development expenses may cast a material impact on its margins and bottom line in the times ahead. Thus, the company’s prospects, though bright, remain vulnerable to operational headwinds.
We believe that if an investor seeks a position in this industry, then Ubiquiti – with a dominant industry position and favorable business trends – presents an interesting investment proposition right now.
Zacks Rank and Key Picks
Some other favorably placed stocks in the broader computer & technology sector include Aspen Technology, Inc. (AZPN - Free Report) and Guidance Software, Inc. , both carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Aspen Technology deals in process optimization software and services. It boasts a remarkable average surprise of 23.6% over the trailing four quarters, having surpassed estimates strongly in each of them.
Guidance Software, an industry leader in digital investigative solutions, also has an impressive earnings history. The company has beaten estimates in all the four trailing quarters, with an average surprise of 18.6%.
Zacks' Top Investment Ideas for Long-Term Profit
How would you like to see our best recommendations to help you find today’s most promising long-term stocks? Starting now, you can look inside our portfolios featuring stocks under $10, income stocks, value investments and more. These picks, which have double and triple-digit profit potential, are rarely available to the public. But you can see them now. Click here >>