Ryan Koontz, an analyst from Needham, maintained the Buy rating on Harmonic (HLIT – Research Report). The associated price target is $18.00.
Ryan Koontz has given his Buy rating due to a combination of factors indicating a strong position for Harmonic. Koontz’s analysis suggests that Harmonic, under the ticker HLIT, stands as a leading supplier within the cable industry, which is currently engaged in a competitive battle to maintain its consumer broadband dominance. With less than 30% of the estimated $2 billion yearly cable broadband capital expenditures shifted to next-generation architecture, Harmonic’s significant market share of over 60% places it in a favorable position for growth. Additionally, the high-margin cOS software platform and hardware nodes offered by Harmonic encounter only modest competition, which is anticipated to result in over 50% next-generation gross margins.
Furthermore, Koontz’s optimism is bolstered by the strong revenue potential following Harmonic’s recent Charter win. The expected divestiture of its video business unit in the first half of 2024 could streamline Harmonic into a pure-play entity with a projected 30% growth rate, justifying a substantially higher market multiple. The price target of $18 set by Koontz is predicated on a price-to-earnings ratio of 21 times the forecasted fiscal year 2024 estimates, reflecting both the company’s robust financial outlook and its strategic position within the rapidly evolving broadband industry.
In another report released on December 13, Raymond James also maintained a Buy rating on the stock with a $19.00 price target.
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Harmonic (HLIT) Company Description:
Harmonic, Inc. engages in the development and sale of video delivery software, products, system solutions, and services. It operates through the Video and Cable Edge segments. The Video segment sells video processing and production and playout services to cable operators, satellite and telecommunications pay-TV service providers, and broadcast and media companies, including streaming new media companies. The Cable Edge segment markets cable access solutions and related services, such as CableOS software-based Converged Cable Access Platform (CCAP) solutions. The company was founded in June 1988 and is headquartered in San Jose, CA.
Read More on HLIT:
- Needham comm infrastructure analyst holds analyst/industry conference call
- Harmonic price target raised by $4 at Raymond James, here’s why
- Harmonic’s broadband platform selected by Okinawa Cable Network in Japan
- Harmonic price target lowered to $14 from $20 at Barclays
- Harmonic Announces Third Quarter 2023 Results
