Two announcements by Harmonic Inc (NASDAQ:HLIT), one technical, the other financial, gave bulls the license to propel the stock higher by 25.11% on Wednesday.
Lending credence to the surge was traded volume of 4.81 million shares.
Investors were enthused by Harmonic’s launch of the CableOS™ system, the industry’s first software-based CCAP solution, and a game-changing utility that fundamentally changes the economics of a cable access network.
“The end-to-end solution provides unprecedented scalability, agility and cost savings, and enables fast deployment of new IP-based data, video and voice services,” Harmonic said Tuesday.
Harmonic is a global leader in video infrastructure products for the television and Internet industries.
Harmonic Inc (NASDAQ:HLIT) strengthens its partnership with Comcast
Harmonic also announced a warrant agreement with Comcast Corporation (NASDAQ:CMCSA) which allows the latter to buy shares of common stock of Harmonic depending upon specified CableOS™ and other Harmonic product sales and deployment milestones during the term of the warrant.
Under the agreement, Comcast could end up owning up to 7.8 million shares of Harmonic at a price of $4.76.
The deal further cements the existing relationship between the two companies.
“This agreement is a significant validation of our new product investment strategy,” said Patrick Harshman, Harmonic’s President and CEO.
Harmonic Inc (NASDAQ:HLIT): Quarterly results and analyst ratings
Last month, Harmonic reported Q2 EPS of $0.00 which beat estimates by $0.04. Revenue of $109.5 million was up 6.2% year on year and ahead of estimates by $5.02 million.
Harmonic will report on its next quarter on October 25, 2016. Consensus estimate of EPS is in the range of $0.12 to $0.14 and revenue in the range $114.5 million to 120.3 million.
Last month, analysts at Drexel Hamilton upgraded their rating on Harmonic from Hold to Buy.
Technically, Harmonic is in an uptrend with price solidly above the 200 SMA by 68.37%.