http://thefly.com/landingPageNews.php?id=2348005
Jefferies analyst George Notter says that while Microsoft (MSFT) and Inphi’s (IPHI) announcement of PAM4/100G transceiver technology “sounds scary” for Infinera’s (INFN) DCI business, the risk/reward on Infinera shares still looks attractive. Based on conversations with industry contacts, PAM4 will take some time to hit 80 km distances, Notter tells investors in a research note. He estimates that $20M of Infinera’s Metro DCI business at Microsoft is at risk in 2016 because of PAM4. He views Google’s announcement on Tuesday that its adding 12 new data center regions as “great news” for Infinera and Ciena (CIEN), and to a lesser extent, Alcatel-Lucent (ALU). Notter has a Buy rating on Infinera with a $22.50 price target.
Best,
–Kevin