by Ian Harvey
IMPORTANT NOTE: There is no stop-loss or pre-determined sell price recommended – this is left to the discretion of the individual trader.
Thursday, 2nd June, 2016
Five Below, Inc (NASDAQ:FIVE) Calls
**OPTION TRADE: Buy the FIVE July 15 2016 46.000 call at approximately $1.00. Sell price is left to your own judgment.
Thursday, 2nd June, 2016
Ambarella Inc (NASDAQ:AMBA) Calls
**OPTION TRADE: Buy the AMBA July 15 2016 45.000 call at approximately $1.50. Sell price is left to your own judgment.
Ramsay wrote, “Consistent with the soft guidance management provided back in March, we anticipate revenue will decline roughly 15% Y/Y with less visibility into professional security camera sales in China and essentially zero chip sales to previously top customer GoPro given sports camera inventory in the channel and the delay of GoPro’s Karma drone. That said, our long-term conviction regarding Ambarella’s leading technology position in several growing end markets including wearable, security, automotive, and drone cameras remains intact and we believe long-term investors will be rewarded as new design wins ramp and the launch of new 14nm chipsets next year return the company to solid Y/Y sales/earnings growth.”
Bottom line: “Given $9/share in net cash and solid growth prospects for the overall business outside of GoPro, we believe shares represent an attractive value for long-term investors.”
Eight research analysts have rated the stock with a hold rating, thirteen have given a buy rating and one has assigned a strong buy rating to the stock. Ambarella has an average rating of “Buy” and a consensus target price of $72.86.
Ambarella Inc’s 50-day moving average is $40.51 and its 200 day moving average is $45.04. The company has a market capitalization of $1.34 billion and a price-to-earnings ratio of 18.21. Ambarella Inc has a 12 month low of $33.39 and a 12 month high of $129.19.
Wednesday, 1st June, 2016
Ciena Corporation (NYSE:CIEN) Calls
**OPTION TRADE: Buy the CIEN June 17 2016 17.000 call at approximately $1.00. Sell price is left to your own judgment.
Ciena Corporation (NYSE: CIEN), a provider of communications networking equipment, software and services that support the transport, switching, aggregation and management of voice, video and data traffic, is scheduled to release its fiscal second-quarter numbers before the market opens on June 2. Analysts forecast earnings of $0.27 per share, down from $0.35 during the same period last year.
Ciena has managed to grow earnings in recent quarters, but that is expected to change with analysts expecting earnings to fall 22.8% versus the same period last year. Despite the expected earnings drop this quarter, Wall Street still expects full-year earnings growth of 0.8%, and for earnings to jump 25.8%. The company has a strong history of posting better than expected results, with earnings topping the consensus each of the last five quarters.
One of the company’s closest competitors, Cisco Systems (CSCO) reported its quarterly results on May 18, topping estimates for both the top and bottom lines. The stock moved higher on the results, and pulled CIEN shares higher as well. Cisco’s report suggests that Ciena could also impress Wall Street, resulting in additional gains for the stock.
This company leverages its deep expertise in packet and optical networking and distributed software automation to deliver solutions in alignment with its OPn architecture for next-generation networks. The company enables a high-scale, programmable infrastructure that can be controlled and adapted by network-level applications, and it provides open interfaces to coordinate computing, storage and network resources in a unified, virtualized environment.
Nomura analyst Jeffrey Kvaal has stuck to his Buy rating, saying that he expects the gap between the solid market and low multiple to close. Furthermore, he sees Ciena's end market benefiting from growth in video, webscale traffic and the 100G optical cycle.
Ciena continues to benefit from strong demand for packet-optical transport and switching products, integrated network, and service management software. Higher spending on optical upgrade and a higher number of orders from international customers will likely boost its top line. Additionally, growing demand for cloud-based on-demand networking capabilities is also likely to bode well. Mobile bandwidth consumption is expected to rise phenomenally, thereby providing more growth opportunities to the company.
Currently, the company is one of the leading suppliers of 40G and 100G optical transport technology. In addition, the company is making efforts to expand its Web Scale IT Architecture in the enterprise market by launching products like new chipsets, metro architecture and mobile backhaul solutions. It is believed that Ciena's strong product portfolio will boost its top line.
There are 12 analysts that are rating the stock a buy while 6 rate CIEN a strong buy.
The company has a 50-day moving average of $16.85 and a 200 day moving average of $19.21. Ciena has a one year low of $15.62 and a one year high of $26.50. The firm has a market capitalization of $2.33 billion and a price-to-earnings ratio of 112.87.
Wednesday, 1st June, 2016
Broadcom Ltd (NASDAQ:AVGO) Calls
**OPTION TRADE: Buy the AVGO June 17 2016 170.000 call at approximately $1.20. Sell price is left to your own judgment.
Broadcom Ltd (NASDAQ: AVGO), the combined entity that was formerly known as Avago and Broadcom, which is a leading designer, developer and global supplier of a broad range of analog and digital semiconductor connectivity solutions, is scheduled to report second-quarter fiscal 2016 results after the closing bell tomorrow, June 2. In the last reported quarter, Broadcom's adjusted earnings comfortably exceeded the Consensus Estimate by 15 cents.
The company has beaten earnings estimates in each of the last four quarters with an average positive earnings surprise of 6.6%. Let's see how things are shaping up for this announcement.
In the fiscal second quarter, Broadcom added Ethernet switching and routing, standard products, physical layer (PHY) copper, and optical standard products to its offerings. The company exhibited its PAM-4 PHY chips driving copper cables, which are designed for 100GbE, 200GbE and 40GbE data center interconnects, at the Optical Fiber Communication summit. Such innovative products are likely to augment the revenues of the company.
For the quarter, in addition to Avago classic RF FBAR (Film Bulk Acoustic Resonator) filters and power amplifiers, the company's wireless segment is likely to include classic Broadcom's wireless connectivity and custom analog handset solution. Broadcom expects the wireless segment to contribute approximately 23% of the company's total revenues from continuing operations. BMO Capital Markets continues to be positive on the company's fiscal 2016 second quarter results due out Thursday after the market close.
In a note issued to investors yesterday, the firm reiterated its "outperform" rating on the stock with a price target of $185.
Analysts are looking for earnings of $2.38 a share on revenue of $3.55 billion for the recent period.
In February, Avago, which makes semiconductors for the cellular, automotive and defence industries completed its $37 billion-acquisition of Broadcom, the wireless chipmaker.
TheStreet Ratings currently has a "Buy" rating on the stock with a letter grade of A+.
The company's strengths can be seen in multiple areas, such as its revenue growth, growth in earnings per share, increase in net income, notable return on equity and expanding profit margins. We feel its strengths outweigh the fact that the company is trading at a premium valuation based on our review of its current price compared to such things as earnings and book value.
Sell side firm Mizuho Securities has reiterated a Buy rating for Broadcom Ltd with a Price Target of $175 before the company announces its 2Q results.
Mizuho Securities in its report stated that it expects the semi-conductor company to report results in line with the expectations with revenue for the quarter of $3.6 billion along with Earnings per Share (EPS) of $2.37.
Thirty-two equities research analysts have assigned a buy rating and two have given a strong buy rating to the stock. Broadcom Limited presently has an average rating of “Buy” and a consensus target price of $173.00.
Broadcom Limited traded up 0.69% during trading on Tuesday, hitting $154.36. 2,960,190 shares of the stock were exchanged. Broadcom Limited has a 12-month low of $100.00 and a 12-month high of $159.65. The stock has a 50 day moving average price of $148.72 and a 200-day moving average price of $139.61. The firm has a market capitalization of $60.27 billion and a PE ratio of 31.57.