Calix up after Rosenblatt starts coverage with 'buy' on broadband demand

Calix

12/04/2022 17:07

** Shares in cloud services provider  CALX.N  rise as much
as 9.2% after Rosenblatt Securities starts coverage with "buy"
rating 
    ** Stock, last up ~7% at $40.20, on track for best day in
nearly a month
    ** Rosenblatt sees good buying opportunity, given strong
demand for broadband and recent pullback in CALX's stock, which
is down around 50% YTD
    ** Says industry backdrop for fiber broadband is "the best
it has ever been", adding it views CALX as more protected
against an economic downturn than many assume as broadband is a
household essential
    ** There is a greater consumer willingness to pay for
broadband, which we think could offer protection against a
recession - Rosenblatt
    ** Adds CALX's business model is "developing nicely" even
amid supply chain hit to margins, noting co's gross margins are
~1,500 basis points better than those of its competitors
    ** Brokerage sets PT at $60, implying an upside of ~59% to
stock's last close 
    ** Eight brokerages' avg. rating on CALX is "buy", median PT
at $62 - Refinitiv data

 (Reporting by Deborah Sophia in Bengaluru)
 ((DeborahMary.Sophia@thomsonreuters.com;))