Acme Packet has near future prospects in upward direction, predicts RBC

Acme Packet, the developers of voice over phone lines products, are yet to see progression in their stock value. Its share price in the market has fallen more than 75 percent in a year and a half, with 37 percent fall this year.

However, the latest rating from RBC Capital Markets might give some boost to the equity. Company rated the stock as hold chiefly because it sees a growth prospect at Acme in the coming months.

The company specializes in the manufacturing of what is called session border controllers, devices that help in making voice calls over landline broadband connections and wireless networks like LTE (Long-Term Evolution).

Landline broadband connections have not received any substantial reinforcements from the likes of AT&T and Verizon Communications for some time now. Moreover, the VoLTE upgrades are still in pipeline on these companies’ LTE networks. That is the main reason why Acme Packet, one of the most profitable companies during 2010 and 2011 has seen the bottom of the graph.

There is a strong possibility that in the coming months wireless carriers will update their LTE networks with the voice-over features and Acme is considered to be the primary beneficiary.

“Wireline growth is stabilizing and investors are now looking for the next lever for growth. VoLTE may be more of a 2014 story, with carriers currently focused on LTE projects,” RBC analyst Mark Sue said.

Sue rated the stock at hold and predicted a share price of $22. APKT is trading at near $19.45. “Our top-line (revenue) growth estimate for 2012 is 17%-plus ($319 million in sales), while 2014 may bring growth in the mid- to high teens (with $361 million in sales),” wrote Sue in a report.

This is above the poll conducted by Thomson Reuters. Analysts estimate revenues of $304.5 Million in 2013, while, revenues for the next year are expected to be in the neighbourhood of $349.2 Million.

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Posted by Usman Khalid on Sep 13 2012. Filed under Sci-Tech. You can follow any responses to this entry through the RSS 2.0. You can skip to the end and leave a response. Pinging is currently not allowed.