FNSR Finisar VCSELs - A Billion Dollar Opportunity With Apple's Investment to Speed it Along

Finisar (FNSR charts) VCSELs represent a ONE Billion Dollar opportunity now backed by Apple's (AAPL) investment to speed it along.

Loading up during this period of weakness, especially while under $20, worked out great for me and my subscribers! 

It is nice when one sends an email from his phone when the market opened saying he's pleased with the buy at $17.55 earlier this month (when I had a buy at $17.50 that I used cash in my ROTH to fund.) 

From Apple: Apple awards Finisar $390 million from its Advanced Manufacturing Fund

• Award Will Create 500 High-Skill Jobs at Sherman, Texas Facility
• “VCSELs power some of the most sophisticated technology we’ve ever developed and we’re thrilled to partner with Finisar over the next several years to push the boundaries of VCSEL technology and the applications they enable,” said Jeff Williams, Apple’s chief operating officer. “Technology is only as good as the people behind it, and Finisar is a company with a long history of putting its employees first and supporting the community it’s a part of. We’re extremely proud that our involvement will help transform another American community into a manufacturing powerhouse.”

This is a very similar deal to how Apple gives money to Foxcon to make their iPhones. 

To me, I believe Apple wanted a PR win with President Trump to show it is investing in manufacturing in the US and not just China.

Finisar is building in Texas to keep the technology in the US but in a low tax state not in the Silicon Valley where its headquarters is located.  If CA didn't have such high taxes, we might see this plant built up near Redding CA, just below the Shasta Dam where getting low cost renewable electricity would be easier than in Texas.

Market measured in Billions of Dollars:

Simon Leopold - with Raymond James:

The other thing I wanted to ask about is really from an industry perspective, your view of the addressable opportunity for the 3D sensing. So, not specific to what you think you are necessarily going ship but help us understand how you are sizing the market opportunity in 2018? And presumably, I want to ask about 2019, since given the timing of the ramp of the new facility, I have to imagine you are thinking about 2019 already.

Jerry Rawls - Finisar Chairman and CEO:

3D sensing is essentially gigantic. If all the customers and the consumer space and the automotive space really build systems and deploy them as they are -- they have indicated to us recently, then, no matter how big this building is that we just bought, and fill it full of equipment, it’s unlikely that we can supply all of the demand that we’ll need to supply. So, I mean, it’s measured in billions of dollars and it’s really hard to project today that how many of these applications are people really going to field. But, I’ll just tell you, we are building arrays for a lot of different people in both mobile and in automotive, some of them are quite small arrays and some of them are gigantic arrays, so.

Source:  Dec. 7th Earnings Conference Call Transcript

Recent (earlier this month) emailed BUY ALERT to subscribers:

My best buy was near the very bottom of the worst bear market since the Great Depression:

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Update 12/13/17 at 11:38AM PST:  SEC FORM 8-K

Item 8.01 Other Events. Questions have arisen regarding news reports of Apple Inc.’s (“Apple”) announcement this morning regarding a $390 million award to Finisar Corporation (“Finisar”). Apple has not made a debt or equity investment in Finisar. The amount referred to by Apple represents anticipated future business between the companies over a period of time.

During Market Turbulence Diversification Works!

Yesterday a subscriber who's worked to get a better asset allocation for her age (after subscribing to my newsletter 2.5 yrs ago in early 2015) was worried about the market and current events sent me this short email.

On 9/5/2017 5:16 PM, RH wrote: 

Hi Kirk;  

The market really looks like it tanked today, right?

OMG, I never really know what to do with next step……

I try to answer all emails, even if they don't have a specific question as I see part of my "service" is to reassure subscribers when they are worried.

Here is part of my reply (removing some personal details for this "edited" reply.)

Remember, one reason we took so many profits and diversified from US stocks that were way up to add to international stocks and build cash is the market often goes down.  You have a LOT of cash now (50:50 conservative asset allocation) so if the market goes down by 10 or 20%, then you could put some of it to work buying stocks at sale prices.

With:

• an H-bomb tested by the nut in N. Korea plus
• Hurricane Harvey left hundreds of thousands with huge storm damage in Texas
• Hurricane Irma is heading towards Florida and it could be even bigger
• Tropical storm Jose is following Irma and could hit either areas just as they start to recover..... 

yet the stock market was only off about 3% at the low!  Stocks like Finisar and GE really suffered but others that investors love, including Emerging markets (VWO) that we recently bought at much lower prices, continue to do well. 

So... remember that your asset allocation is much better now even with the stock market near record highs!  You've done the work to be ready for a big decline.... yet if the market continues to chug higher, you have enough in to do really well too!

On 9/6/2017 10:24 AM, RH wrote: 

You somehow know me well and give me peace of mind.

Thank you ever so much.

Nobody likes to see stocks they own go down but with proper asset allocation and diversification, big declines are great opportunities to increase your overall market return.

Lets say you retire with a $1,000,000 investment portfolio.  To sleep well at night you put half into fixed income and half into stocks according to my "Conservative Core Portfolio."  If the stock market drops 50%, which is has twice since the year 2000, then you would have roughly $750,000 and probably more because your fixed income on the conservative side of the portfolio would continue higher and your stock portfolio (ETFs or individual stocks) would continue to pay dividends.  

I'd use the 50% bear market to significantly add stocks to my Explore Portfolio (as I did during both bear markets.)  I would also do a MINIMUM of one portfolio reallocation from fixed income to stocks at the end of the year if stocks were still down just as last January I moved a great deal of cash out of markets that were way up in the Core Portfolios to fixed income to lock in gains.

If you need references to verify I took profits when the markets were up and bought when they were down to get the returns I post, then I am happy to provide them.  It blows me away that so many sell their newsletter services and don't provide simple return tables and graphs like I do below.  That is a RED FLAG WARNING about what they sell.

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-end-

FNSR Finisar Soars After Hours on Strong Guidance

Finisar (FNSR) Soared After Hours today on Strong Guidance for record revenues for the just completed quarter.

From Yahoo! Finance InPlay

5:07PM Finisar guides Q1 above prior guidance/consensus (FNSR) 19.13 -0.88 : Co issues upside guidance for Q1 (Jul), sees EPS of $0.30 to $0.31, excluding non-recurring items, vs. $0.24 Capital IQ Consensus Estimate, exceeding the previously estimated range of $0.22 to $0.26; sees Q1 (Jul) revs of $266 mln vs. $253.40 mln Capital IQ Consensus Estimate and compared to guidance of $245 to $260 million.

The revenue results are preliminary and subject to adjustment. However, in the absence of material adjustment, first quarter revenues will set a new record for the Company and will be the fourth consecutive quarter of sequential revenue growth. The growth in revenue came primarily from increased sales of 10G, 40G and 100G Ethernet transceivers for datacom applications. Approximately $2 million of the revenue growth over the prior quarter was from products for telecom applications. 

As a result of these higher than expected revenues, a favorable product mix and increased operating leverage, the Company expects non-GAAP gross margin to be 34.5% to 35%. 

stock is halted - Press Release Below

August 06 chart for Finisar

Live Intraday Chart for FNSR

More FNSR charts

SUNNYVALE, CA--(Marketwired - Aug 6, 2013) -  Finisar Corporation (NASDAQ: FNSR) today announced that, on the basis of preliminary financial results, the Company expects to report revenues of approximately $266 million for its first fiscal quarter, ended July 28, 2013, compared to guidance of $245 to $260 million that the Company provided early in the first quarter. The revenue results are preliminary and subject to adjustment. However, in the absence of material adjustment, first quarter revenues will set a new record for the Company and will be the fourth consecutive quarter of sequential revenue growth. The growth in revenue came primarily from increased sales of 10G, 40G and 100G Ethernet transceivers for datacom applications. Approximately $2 million of the revenue growth over the prior quarter was from products for telecom applications.

As a result of these higher than expected revenues, a favorable product mix and increased operating leverage, the Company expects non-GAAP gross margin to be 34.5% to 35%. This exceeds the previous guidance of approximately 33%. Non-GAAP earnings per share are expected to be $0.30 to $0.31 for the quarter, exceeding the previously estimated range of $0.22 to $0.26. A complete assessment of cost of revenues and operating expenses is not yet available but, results under GAAP are expected to include additional non-cash and infrequently occurring charges.

QUARTERLY CONFERENCE CALL

The Company expects to release its first quarter financial results after the market close on Thursday, September 5, 2013 and to discuss the first quarter results and its current business outlook during its regular quarterly conference call scheduled for Thursday, September 5, 2013, at 2:00 pm PDT (5:00 pm EDT). 

YADDA-YADDA STUFF HERE

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My Articles about FNSR on Seeking Alpha -

Long Term Results that Speak for ThemselvesSince 9/30/98 inception, "Kirk's Newsletter Explore Portfolio" is UP 450%vs. the S&P500 UP only 106% vs. NASDAQ UP only 101% (All through 6/30/13)Since 12/31/98: 9.0% Compound Annual Return vs. 3.7% for the S&P500
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Finisar CEO Rawls Buys 100,000 Shares at $1.43

Finisar Corp. (More FNSR Charts) CEO, Jerry Rawls, bought 100,000 shares of Finisar stock in the open market on 12/17 and 12/18 at an average price of $1.43 per share.

According to the SEC filing and Yahoo!, this brings his stake (Note 1) to 2,876,203 shares.

On December 14, 2007, two other Finisar insiders purchased 10,000 shares each.

• Joseph A Young added 10,000 shares at $1.43 per share. This follows non open market purchases on June 15, 2006 of 5,434 shares at $1.96 per share ($10,650) and 5,434 more shares at $2.02 per share ($11,000)
  
• Anders Olsson added 10,000 shares at $1.48 per share ($14,800) after selling 20,000 shares in July 2006 at $3.27 per share (Proceeds of $65,400 nice trading!)

About Finisar

Finisar Corporation (NASDAQ: FNSR) is a global technology leader for fiber optic components and subsystems and network test and monitoring systems. These products enable high-speed voice, video and data communications for networking, storage and wireless applications over Local Area Networks (LANs), Storage Area Networks (SANs), and Metropolitan Area Networks (MANs) using Ethernet, Fibre Channel, IP, SAS, SATA and SONET/SDH protocols. The Company is headquartered in Sunnyvale, California, USA. More information can be found at http://www.finisar.com/ and "Kirk's Investment Newsletter."

1. Shares are held by the Rawls Family, L.P. Mr. Rawls is the president of the Rawls Management Corporation, which is the general partner of the Rawls Family, L.P.

Subscribe to Kirk's Investment Newsletter today to get my current outlook for FederFinsar including target prices for 2008 and 2009.

Disclaimer: I own FNSR in my personal and newsletter portfolios. I may trade around a core position at any time.

Finisar Up After Regaining NASDAQ Listing Compliance

Finisar (more FNSR Charts) Regains Compliance With Nasdaq Listing Requirements

SUNNYVALE, CA, Dec 10, 2007 (Web Site Press Release) -- Finisar Corporation (NASDAQ: FNSR), a technology leader in gigabit fiber optic solutions for high-speed data networks, today announced it had received confirmation that the Nasdaq Listing and Hearing Council has determined that, with the filing of its previously delayed annual report on Form 10-K and quarterly reports on Form 10-Q on December 4, 2007, Finisar has demonstrated compliance with Nasdaq's filing requirements under its Marketplace Rules. Accordingly, Finisar's common stock will continue to be listed on The Nasdaq Global Select Market.

About Finisar

Finisar Corporation (NASDAQ: FNSR) is a global technology leader for fiber optic components and subsystems and network test and monitoring systems. These products enable high-speed voice, video and data communications for networking, storage and wireless applications over Local Area Networks (LANs), Storage Area Networks (SANs), and Metropolitan Area Networks (MANs) using Ethernet, Fibre Channel, IP, SAS, SATA and SONET/SDH protocols. The Company is headquartered in Sunnyvale, California, USA. More information can be found at http://www.finisar.com/ and "Kirk's Investment Newsletter."



Subscribe to Kirk's Investment Newsletter today to get my current outlook for Finisar including buy and sell levels to trade around a core position.

Finisar: Analyst Comments on Q1 2007 Results

The Sept 4, 2007 7:10PM EST Press Release says:

• Networking equipment company Finisar Corp. said Tuesday its fiscal first-quarter revenue declined slightly, but the company did not give detailed earnings results because it is reviewing past stock option granting practices.


• For the quarter ended July 29, Finisar's sales totaled $105.7 million, down slightly from $106.2 million in the year-ago quarter. Analysts polled by Thomson Financial were expecting sales of $107.32 million.


• The company said gross margins were lower than the previous quarter, due largely to higher costs from new product introductions. "We were pleased to see revenues bounce back from last quarter as we recovered from a number of customer supply chain and excess inventory issues," said Jerry Rawls, chief executive, in a statement. Finisar's sales in the prior quarter totaled $97.3 million.

Not stating earnings until they sort out the option backdating issues was not news. The news was they missed analysts’ expectations for earnings by $1.6M or 1.5%, which is pretty much noise. On the news, Finisar fell 24% from $3.78 to $2.87 in two days.

Assorted comments follow:

• Sept 5, 2007: Needham & Co downgraded FNSR from “Strong Buy” to “Buy”
  


• Sept 5, 2007: Deutsche Bank analyst Cobb Sadler reduced his price target on the stock to $4 from $4.50, calling the first-quarter results "disappointing" and the company's second-quarter revenue forecast "conservative." Sadler maintained a "Buy" rating the stock, and wrote in a client note, "We remain buyers of Finisar on weakness as we see medium term potential."
  


• Sept 5, 2007: TSC Staff wrote ”Finisar sees revenue of $105.7 million for its fiscal 2008 first quarter -- $500,000 less than the comparable period last year and below the $108.2 million consensus estimate recorded by Thomson Financial. Shares fell 81 cents to close at $2.95.”
  


• Sept 5, 2007: Ruthie Ackerman of Forbes may have hit the nail on the head with this comment linking Finisar to the subprime mess:
  
  

  “Finisar, the report stated, had negative $24.4 million in free cash flow in the
  latest fully reported fiscal year. The last time Finisar filed a complete earnings report with the Securities and Exchange Commission was on July 31, 2006, according to the report. Late earnings filings with the SEC are a potential risk because companies can be considered in technical default if they file late financial statements, giving bond holders the right to demand automatic repayment of debt. “While there may not have been many such demands in recent years, a strained credit market may test the leniency of note holders,” the report said. (See “ Subprime Spillover: Who’s Next?”)



• Sept 10, 2007: James Altucher or The Street.com wrote:
  
  

  "The downgrade sent shares to a fresh 52-week low. Finisar provides optical components that connect local area network and storage data. Some investors feel that Finisar is losing sales to other competitors, but upon a closer look, this does not appear to be the case. With $100 million in cash on the balance sheet, Finisar is not going anywhere.ADC Telecommunications (ADCT,) a major competitor, recently reported great earnings showing the true cyclical strength in this sector. I expect similar results from Finisar next quarter. In the near term, I believe Finisar is poised to bounce back from the 52-week low list as investors and traders see a buying opportunity with the recent selloff.

I believe James Altucher and Ruthie Ackerman have it right. Opportunity knocks.

More Finisar Charts here

Disclaimer. I accumulated Finisar in my Newsletter Portfolio between $1.01 and $1.99 and still hold it today in both my newsletter and personal accounts. I may buy or sell at any time and will probably not announce it here. Of course, I have "auto sell" levels in the newsletter to take more profits and any additional buys or sells in the newsletter portfolio will be announced to subscribers via email when made.