M/A-COM Technology (MTSI) Optical Results 'Encouraging', Needham & Company; Remains on Sidelines Due to Valuation

Needham & Company analyst N. Quinn Bolton reiterated a Hold rating on M/A-COM Technology Solutions (NASDAQ: MTSI) following results which he said showed encouraging demand in optical. The analyst remains on the sidelines given its views that the shares are fully valued.

Bolton commented, "Including a $15.1MM one-time benefit from an accounting change, M/A-COM delivered revenue at the high-end of guidance and beat on NG GM and EPS. In F1Q15, MTSI's A&D and Multi-Markets segments grew sequentially while the Networks and Automotive segments experienced seasonal declines. The optical business, however, grew 35% Q/Q (excluding the BinOptics acquisition), partially offsetting seasonal weakness from RF, microwave, and Chinese wireless infrastructure customers. The company also announced a 6.5MM share equity offering, including 4.5MM primary shares, the proceeds of which will be used to repay the $100MM outstanding balance on the company's revolving line of credit. We maintain our Hold as we believe shares are fully valued at current levels."

The firm bumped FY 2015 EPS from $1.65 to $1.68 and maintained FY 2016 EPS at $2.10.

For an analyst ratings summary and ratings history on M/A-COM Technology Solutions click here. For more ratings news on M/A-COM Technology Solutions click here.

Shares of M/A-COM Technology Solutions closed at $32.30 yesterday.

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