To that end, Adtran has solid broadband access and internetworking segments that should pay some good dividends in the coming quarters. The fact that the Broadband business surged 100% year over year, coupled with 9% growth in international business, puts Adtran in a position to attract some attention from the likes of Oracle (ORCL), which just acquired Acme Packet (APKT).
Though there are still some weaknesses, overall investors have to be pleased with the company's direction. The good news though, is that Adtran has three prominent carriers in Verizon (VZ), AT&T (T) and Qwest, which accounts for close to 55% of the company's revenue, and each are expected to increase their spending as the year progresses.
In the meantime, profitability should continue to improve, given the company's attention towards preserving margins along with better cost management. With earnings due out Wednesday after the market closes, analysts are expecting 8 cents per share on revenues of $139.82 million. This would represent 4% year-over-year growth and flat sales sequentially.
Given the current environment, this should be considered a win. I've always liked Adtran. But I would be more excited if the company were to be a bit more aggressive. With carrier spending expected to rebound, the companies that will prevail are the ones that are best positioned to deliver the right mix of equipment, communication services and at the right price. It's hard to not bet on Adtran.At the time of publication, the author held no position in any of the stocks mentioned. Follow @saintssense