Sounds a little optimistic
Research Alert: CFRA Maintains Hold Opinion On Shares Of Ribbon Communications Inc.
MT NEWSWIRES 4:15 PM ET 5/2/2022
05:15 PM EDT, 05/02/2022 (MT Newswires) -- CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows:
We keep our 12-month target price at $5, 17.9x our '22 EPS estimate, a discount to its three-year historical average P/E at 20.1x, reflecting our soft growth outlook. We trim our '22 EPS estimate by $0.05 to $0.28 and raise '23's by $0.10 to $0.44. RBBN reported a Q1 operating loss of $0.08 vs. EPS of $0.03, in line with the consensus. Q1 revenue declined 10.2%, driven by a 35.3% drop in the Cloud and Edge segment, due to declines in product revenue and the timing of some service projects, and a 6.0% drop in the IP Optical business. Gross margin contracted 700 basis points to 50.2% due to lower revenue to absorb fixed costs, higher costs in it supply chain and service delivery organizations, and a less favorable product mix. Given its backlog, we expect to see increases in IP Optical sales, primarily driven by projects in the European region, while Cloud and Edge growth will come from network transformation projects in North America.