Drop in UBNT's share price on Friday 2/13

UBNT was looking good in the pre-market with a bid/ask at 30.67 / 31.00

Pretty soon after the open however, it started dropping and almost hit $28. That is a pretty steep drop after the nice jump the previous day.

The main reason for the drop is Google’s Project Loon announcement:

http://www.livemint.com/Companies/p7qDbPTVYnUq3hnTuLTNcK/Goo…

Google X to commercially launch Project Loon and Makani by 2016 Project Loon, the balloon-powered Internet initiative, offers cheap Internet access to about 4.5 bn people across the world

www.google.com/loon/

I am guessing that people assumed that UBNT will lose huge market share when this comes online.

Yet, some old posts on the Ubiquiti forums seems to suggest that Google would be using UBNT equipment for this project loon.

https://community.ubnt.com/t5/The-Lounge/Project-Loon/td-p/4…

Anybody know more about this? I would love for Google’s project loon to be wildly successful if it does use UBNT equipment. If on the other hand they don’t use UBNT equipment, I hope it is not successful :slight_smile:

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Like you, I went scrambling to find the reason for the drop in share price on Friday. Like you, I came to believe it was the Project Loon news. Like you, I discovered that UBNT has played a role and may, in fact, continue to play a role if Project Loon ever becomes reality.

I found another UBNT forum link with additional comments:

http://tinyurl.com/pkpya5x

I’ve just been down to talk to the folks from Google, who are here in Christchurch, New Zealand, launching their pilot for Loon. One engineer told me “we use the Ubiquiti Rocket M2 for transceiving, and the M5 for groundstation uplink”. He described the downwards-pointing antenna on the ballon, which sounded to me like a UniFi polar map, but on a bigger scale. They have modified the firmware to only work with other modified firmware Rockets.

We live in interesting times.

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putnid,

The wiki entry also mentions what the guy in NZ heard :slight_smile:

http://en.wikipedia.org/wiki/Project_Loon

Equipment

The balloon envelopes used in the project are made by Raven Aerostar,[17] and are composed of polyethylene plastic about 3 mil or 0.076 mm (0.0030 in) thick. The balloons are superpressure balloons filled with helium, stand 15 m (49 ft) across and 12 m (39 ft) tall when fully inflated, and carry a custom air pump system dubbed the “Croce”[18] that pumps in or releases air to ballast the balloon and control its elevation.[1] A small box weighing 10 kg (22 lb) containing each balloon’s electronic equipment hangs underneath the inflated envelope. This box contains circuit boards that control the system, radio antennas and a Ubiquiti Networks Rocket M2[19] to communicate with other balloons and with Internet antennas on the ground, and batteries to store solar power so the balloons can operate during the night. Each balloon’s electronics are powered by an array of solar panels that sit between the envelope and the hardware. In full sun, the panels produce 100 watts of power, which is sufficient to keep the unit running while also charging a battery for use at night. A parachute attached to the top of the envelope allows for a controlled descent and landing when a balloon is ready to be taken out of service.[12] In the case of an unexpected failure, the parachute deploys automatically.[20] When taken out of service, the balloon is guided to an easily reached location, and the helium is vented into the atmosphere. The balloons typically have a maximum life of about 55 days, although Google claims that its tweaked design can enable them to stay aloft for more than 100 days.[13]

The prototype ground stations use a Ubiquiti Networks Rocket M5[19] radio and a custom patch antenna[21] to connect to the balloons beaming down the Internet when the balloons are in a 20 km (12 mi) radius.[6] Some reports have called Google’s project the Google Balloon Internet.[2][22][23]

[19] Ubiquiti Networks Community Forum. I’ve just been down to talk to the folks from Google, who are here in Christchurch, New Zealand, launching their pilot for Loon. One engineer told me “we use the Ubiquiti Rocket M2 for transceiving, and the M5 for groundstation uplink”. He described the downwards-pointing antenna on the ballon, which sounded to me like a UniFi polar map, but on a bigger scale. They have modified the firmware to only work with other modified firmware Rockets.

So, it still comes down to what the guy in NZ heard in 2013 from the Google folks :slight_smile:

Hopefully, they still use UBNT equipment. (Rockets M2 and M5)

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interesting, thanks for the links.

But honestly I didn’t even flinch at a 6% drop in UBNT. Even though UBNT has a low valuation it’s a more volatile stock.

For instance on Thursday (Feb 12/15) UBNT rose $1.53 or 5.25%.

I agree, I’ve been watching them for the last quarter and more often than not on days where the market was soaring ubiquiti was in the red or slightly in the green. On days where the market was down and 85% of the stocks on my watchlist were in the red lo and behold ubiquiti was in the green up a couple percentage points or so.

It’s a stock like CREE, it’ll bounce around and may stay in the upper 20’s for a week or two but eventually you know it’s going back up; it may not be today, it may not be tomorrow but it’ll be in the near future.

It won’t be green on Tuesday. Barron’s is suggesting in this weekend’s edition that it is overvalued. The bastard shorts are trying to drive the price down so they can exit UBNT.

http://online.barrons.com/article/the_trader.html

Red Flags at Ubiquity
Not all tech stocks zoom. Ubiquiti Networks (UBNT), the subject of a skeptical item here recently, reported quarterly results that sustain a view that the stock is overvalued compared with peers.

In the fiscal second quarter ended on Dec. 31, its revenue rose 11% from the year-ago period, to $153.1 million, while net income increased 11%, to $46.3 million, or 52 cents per share fully diluted from $41.8 million, or 47 cents per share. That’s tepid compared with 80% sales growth and profits that more than doubled to $177 million, or $2.02, in the June-ended fiscal 2014.

Short Interest is at 9 million.

http://www.nasdaq.com/symbol/ubnt/short-interest

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UBNT moving up on the realization that Project Loon probably uses UBNT Rockets M2 and M5 (see slides 15 / 16)

www.slideshare.net/abcubed3/internet-for-all-stratospheric-s…

Also, see the 1:39 minute mark of this Youtube video. You will see that it is UBNT eqipment

https://www.youtube.com/watch?v=mcw6j-QWGMo

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