Wireless data communication product manufacturer, Ubiquiti Networks, Inc. UBNT , recently announced the expansion of its UniFi Switch product line by rolling out three switching hardware units, namely US-16-XG, US-8-60W and US-8. The expansion of the UniFi Switch product line will enable the company in meeting complex networking needs; thus strengthening its client base and revenues.
Leveraging on the UniFi Software-Defined Networking (“SDN”) Platform, which is at the core of all the three new devices, enterprises can easily manage their wired networks from center to the periphery. An end-to-end system of network devices, UniFi SDN allows seamless management of the UniFi Controller software. This makes it easier for network owners to control UniFi devices efficiently.
US-16-XG is the costliest out of the three switches, with a price tag of $599. It is a 16-port, 10G fiber switch, with advanced Layer-2 switching features and protocols, offering high-bandwidth aggregation connectivity. On the other hand, US-8-60W comes at a relatively lesser price of $109. It has four auto-sensing PoE ports and can deliver up to 15.4W of power per port. The US-8 switch is the cheapest among the three, bearing a price tag of $99. It features one port with PoE pass-through and can be used across a wide range of installations.
Ubiquiti’s shares rallied 15.9% over the past three months, way ahead of the Zacks categorized Wireless Equipment industry average of 4.2%. Encouragingly, Ubiquiti has had a remarkable earnings surprise history in recent times, having beaten estimates consecutively six times in a row. It has an average earnings surprise of 19.7% for the trailing four quarters. Currently, analysts are maintaining a neutral stance on the Zacks Rank #3 (Hold) company as the Zacks Consensus Estimate for fiscal 2017 remained unchanged at $2.96 over the past 30 days.
Periodic launch of innovative products has always been part of Ubiquiti’s primary strategies to grab a wider customer base. During first-quarter fiscal 2017, sales growth of Enterprise Technology segment surged a whopping 75.2%, driven by solid demand for UniFi products (including UniFi AC access points and UniFi Switch).
Further, some of the recently introduced products like UniFi 8- and 16-Port Gigabit Switches, which can deliver powerful performance with their independent switching ports, have been major profit churners for the company. The company remains confident that the launch of these switches will gain rapid traction among its wide enterprise customers base, stoking top-line growth, going ahead.
Stocks to Consider
Some better-ranked stocks in the same space include Applied Materials AMAT , Exa Corp. EXA and Harris Corporation HRS . While Applied Materials and Exa Corp. flaunt a Zacks Rank #1 (Strong Buy), Harris Corporation carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here .
Also, Exa Corp has managed to beat estimates each time, over the last four quarters and has an average positive surprise of 68.1%.
Harris Corporation has an impressive earnings surprise history for the trailing four quarters, beating estimates all through, for an average of 4.2%.
Applied Materials has an average positive surprise of 4.5% for the last four quarters.
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