JDS Uniphase Corp. (Nasdaq: JDSU) shot up 12 percent in pre-market trading Friday as analysts praised its first quarter report.
Shares were up 8.81 to 83.25 on the Island ECN. After market close Thursday, the maker of parts for optical networks reported fiscal quarter earnings of $177 million, or 18 cents a share, on sales of $786 million. First Call Corp. consensus expected JDS Uniphase to earn 16 cents per share. More importantly, the company said it sees continued strong demand for its products.
Optical network equipment vendor Nortel Networks (NYSE: NT) made investors nervous with its disappointing report earlier this year. JDS Uniphase said it sees no lessening of demand for optical components.
Analyst David Wong reiterated a "buy" -- the strongest rating at PaineWebber -- on the stock, and had a 12-month target price of $250 a share. In a phone interview, Wong said the report was "very positive for the end market as a whole, and that's good for everybody involved."
"JDS-Uniphase has good visibility into the December quarter, with a book-to-bill well above one and significantly increased backlog," Wong stated in a report.
Wong also reiterated "buy" ratings on Applied Micro (Nasdaq: AMCC) and Vitesse (Nasdaq: VTSS) Friday, saying "strong results and good prospects for JDS-Uniphase are consistent with ... high expectations for chip companies selling into related optical communications markets."
The stock was also reiterated as a "buy" by analyst Jim Liang at WR Hambrecht + Co. The strong quarter and bullish outlook prompted Liang to raise earnings estimates for fiscal 2001 from $3.5 billion to $3.9 billion, or 80 cents a share, but "given the weak market conditions we are adjusting our price target from $180 to $140," Liang said in a report. He added that the company's merger with SDL is on track and should be completed by the end of the year.
JDS Uniphase was also reiterated a "buy" by analyst David Kang at ABN Amro. The price target was raised to $171 from $168 per share.