Why Oclaro, Inc. Shares Rose 20.7% Last Month
Shares of Oclaro (NASDAQ: OCLR) gained 20.7% in February of 2018, according to data from S&P Global Market Intelligence. After a difficult 2017, the maker of optical networking components headed into last month's second-quarter report with low expectations -- and the results ended up impressing Oclaro's investors.
Essentially all of Oclaro's February gains materialized as a direct response to that second-quarter earnings report in the first week. Top-line sales fell 9.5% year over year to $193 million, on par with Oclaro's own guidance. Adjusted earnings declined from $0.21 to $0.14 per diluted share, but your average analyst would have settled for $0.12 per share.
The company is ramping up production of new, faster fiber-optic modules at an opportune time. Management expects the challenges facing the fiber-optic networking industry to subside in 2018, followed by a new multi-year period of secular growth. The turning point should fall in the quarter ending in June, which is the final reporting period of Oclaro's fiscal year, when sales are expected to see a return to year-over-year growth.
Oclaro's share prices have now fallen 19% over the last 52 weeks, and that's including the strong February surge. Trading at just 9.5 times trailing earnings and with a clear path back to industrywide growth, Oclaro is a tempting ticker for value-conscious investors right now.
10 stocks we like better than OclaroWhen investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
David and Tom just revealed what they believe are the 10 best stocks for investors to buy right now...and Oclaro wasn't one of them! That's right -- they think these 10 stocks are even better buys.
Click here to learn about these picks!
*Stock Advisor returns as of March 5, 2018
Anders Bylund has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.