We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Will Focus on Strategic Collaborations Drive NETGEAR Stock Upward?
Read MoreHide Full Article
NETGEAR, Inc. (NTGR - Free Report) has collaborated with Samsung Electronics' System LSI Business to ensure smooth interoperability and roaming between NETGEAR's Business WiFi 7 access points and Samsung’s WiFi 7 client chipset offering. Both companies were the early adopters of WiFi 7, with NTGR focusing on access points and Samsung on client solutions.
NETGEAR noted that smooth connectivity in areas with many mobile devices is challenging due to WiFi roaming issues. While stationary devices stay connected to one access point, mobile users moving between different locations may experience delays as their devices switch access points. This issue becomes more pronounced in crowded environments like auditoriums where many users attempt to connect simultaneously. The recent collaboration is focused on addressing this problem and developing a solution.
Samsung highlighted that successful interoperability testing with NETGEAR ensures that their Wi-Fi 7 solutions provide an uninterrupted wireless experience with enhanced throughput and lower latency. The new WiFi 7 technology in Samsung’s chipset guarantees seamless connectivity for mobile devices across various networks, showing strong compatibility with NETGEAR’s network solutions.
NETGEAR’s focus on strategic collaborations to enhance its Wi-Fi 7 offerings is expected to drive the top line and, in turn, drive the stock performance.
NTGR to Gain From WiFi 7 Upgrade Cycle
The company benefits from the rising demand for robust networking solutions owing to the growing number of Internet-connected devices and the shift from older WiFi standards to the much-awaited WiFi 7.
In the second quarter of 2024, the Connected Home segment (CHP), which includes Orbi, Nighthawk and Armor, reported revenues of $84 million, marking a 14.6% decline from the prior-year quarter. Despite tough conditions, the segment saw growth in premium products and positive trends for new budget-friendly WiFi 7 products and cable modems. The CHP business anticipates improvement as the WiFi 7 upgrade cycle begins.
Given these factors, management projects net revenues in the band of $160-$175 million for the third quarter. Additionally, NTGR plans to introduce a range of innovative products over the next year to boost market presence and subscription growth. NTGR’s collaboration with Samsung to offer WiFi 7 solutions is expected to drive revenue growth and improve financial performance in the upcoming quarters.
In addition to its expanding range of WiFi 7 routers and mesh systems available through consumer channels, NETGEAR now offers WiFi 7 access points to commercial clients as part of its Total Network Solution. This includes the WBE750 Insight Manageable Tri-band WiFi 7 Access Point and the newly announced WBE710 Insight Manageable Tri-band WiFi 7 Access Point.
These access points offer crucial capabilities for complex business environments, such as real-time responsiveness, low latency and increased capacity. They will soon include preamble puncturing to address signal interference, enabling devices to use parts of different channels for data transmission and significantly reducing network congestion.
Headwinds Persist for NTGR
NTGR’s margins are likely to remain affected by inventory reduction efforts and elevated transportation costs, including the Red Sea shipping crisis. Revenues from the service provider channel are estimated to be $15 million for the third quarter, as new 5G mobile hotspots are expected to be launched in the fourth quarter.
NTGR’s Zacks Rank & Stock Price Performance
NTGR currently carries a Zacks Rank #4 (Sell). Shares of the company have gained 35.9% in the past year against the sub-industry’s decline of 14.1%.
Manhattan Associates delivered an earnings surprise of 26.6%, on average, in the trailing four quarters. In the last reported quarter, MANH pulled off an earnings surprise of 22.9%. The Zacks Consensus Estimate for MANH has increased 9.2% in the past 60 days to $4.26.
Intrusion delivered an earnings surprise of 34.7%, on average, in three of the trailing four quarters. In the last reported quarter, INTZ pulled off an earnings surprise of 26.4%. The Zacks Consensus Estimate for INTZ loss per year is pegged at $2.19.
NetScout Systems delivered an earnings surprise of 53.2%, on average, in the trailing four quarters. In the last reported quarter, NTCT pulled off an earnings surprise of 115.4%. The Zacks Consensus Estimate for NTCT has increased 4.8% in the past 60 days to $2.2.
See More Zacks Research for These Tickers
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Will Focus on Strategic Collaborations Drive NETGEAR Stock Upward?
NETGEAR, Inc. (NTGR - Free Report) has collaborated with Samsung Electronics' System LSI Business to ensure smooth interoperability and roaming between NETGEAR's Business WiFi 7 access points and Samsung’s WiFi 7 client chipset offering. Both companies were the early adopters of WiFi 7, with NTGR focusing on access points and Samsung on client solutions.
NETGEAR noted that smooth connectivity in areas with many mobile devices is challenging due to WiFi roaming issues. While stationary devices stay connected to one access point, mobile users moving between different locations may experience delays as their devices switch access points. This issue becomes more pronounced in crowded environments like auditoriums where many users attempt to connect simultaneously. The recent collaboration is focused on addressing this problem and developing a solution.
Samsung highlighted that successful interoperability testing with NETGEAR ensures that their Wi-Fi 7 solutions provide an uninterrupted wireless experience with enhanced throughput and lower latency. The new WiFi 7 technology in Samsung’s chipset guarantees seamless connectivity for mobile devices across various networks, showing strong compatibility with NETGEAR’s network solutions.
NETGEAR’s focus on strategic collaborations to enhance its Wi-Fi 7 offerings is expected to drive the top line and, in turn, drive the stock performance.
NTGR to Gain From WiFi 7 Upgrade Cycle
The company benefits from the rising demand for robust networking solutions owing to the growing number of Internet-connected devices and the shift from older WiFi standards to the much-awaited WiFi 7.
In the second quarter of 2024, the Connected Home segment (CHP), which includes Orbi, Nighthawk and Armor, reported revenues of $84 million, marking a 14.6% decline from the prior-year quarter. Despite tough conditions, the segment saw growth in premium products and positive trends for new budget-friendly WiFi 7 products and cable modems. The CHP business anticipates improvement as the WiFi 7 upgrade cycle begins.
Given these factors, management projects net revenues in the band of $160-$175 million for the third quarter. Additionally, NTGR plans to introduce a range of innovative products over the next year to boost market presence and subscription growth. NTGR’s collaboration with Samsung to offer WiFi 7 solutions is expected to drive revenue growth and improve financial performance in the upcoming quarters.
In addition to its expanding range of WiFi 7 routers and mesh systems available through consumer channels, NETGEAR now offers WiFi 7 access points to commercial clients as part of its Total Network Solution. This includes the WBE750 Insight Manageable Tri-band WiFi 7 Access Point and the newly announced WBE710 Insight Manageable Tri-band WiFi 7 Access Point.
NETGEAR, Inc. Price and Consensus
NETGEAR, Inc. price-consensus-chart | NETGEAR, Inc. Quote
These access points offer crucial capabilities for complex business environments, such as real-time responsiveness, low latency and increased capacity. They will soon include preamble puncturing to address signal interference, enabling devices to use parts of different channels for data transmission and significantly reducing network congestion.
Headwinds Persist for NTGR
NTGR’s margins are likely to remain affected by inventory reduction efforts and elevated transportation costs, including the Red Sea shipping crisis. Revenues from the service provider channel are estimated to be $15 million for the third quarter, as new 5G mobile hotspots are expected to be launched in the fourth quarter.
NTGR’s Zacks Rank & Stock Price Performance
NTGR currently carries a Zacks Rank #4 (Sell). Shares of the company have gained 35.9% in the past year against the sub-industry’s decline of 14.1%.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked stocks from the broader technology space are Manhattan Associates, Inc. (MANH - Free Report) , Intrusion Inc. (INTZ - Free Report) and NetScout Systems, Inc. (NTCT - Free Report) . MANH presently sports a Zacks Rank #1 (Strong Buy), whereas INTZ & NTCT carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Manhattan Associates delivered an earnings surprise of 26.6%, on average, in the trailing four quarters. In the last reported quarter, MANH pulled off an earnings surprise of 22.9%. The Zacks Consensus Estimate for MANH has increased 9.2% in the past 60 days to $4.26.
Intrusion delivered an earnings surprise of 34.7%, on average, in three of the trailing four quarters. In the last reported quarter, INTZ pulled off an earnings surprise of 26.4%. The Zacks Consensus Estimate for INTZ loss per year is pegged at $2.19.
NetScout Systems delivered an earnings surprise of 53.2%, on average, in the trailing four quarters. In the last reported quarter, NTCT pulled off an earnings surprise of 115.4%. The Zacks Consensus Estimate for NTCT has increased 4.8% in the past 60 days to $2.2.