Finisar Corporation (FNSR), JDS Uniphase Corp (JDSU): Is This Company’s Telecom Business About to Boom?

There’s also potential to benefit from the 4G roll out in China by China Mobile Ltd. (ADR) (NYSE:CHL). Huawei is a key supplier to China Mobile, and the company won a significant share of initial 4G contracts, worth $3.2 billion, awarded by the telecom carrier.

China Daily reported earlier this year that China Mobile Ltd. (ADR) (NYSE:CHL) will boost its capex 49% this year to $30.5 billion. More than half of this budget is expected to be allocated to the 4G roll out as the telecom giant sets out to build 207,000 base stations in 31 provinces. Being a supplier to Huawei, Finisar might also get a share of the China Mobile 4G capex going forward and this would be another tailwind for its telecom business.

Final words
Finisar’s telecom business has been a sticking point for analysts, but developments in the telco industry signify a rebound might be in the cards. Finisar’s datacom business, which accounts for the majority of its revenue, has been strong and prospects here look bright.

Data center build outs, impressive products that are more efficient than rivals’ offerings, and clients like Cisco are tailwinds for Finisar’s datacom business. Coupled with a rebound in telecom and sustained strength in datacom, Finisar looks well-positioned to deliver sunny guidance along with its upcoming results.

The article Is This Company’s Telecom Business About to Boom? originally appeared on Fool.com and is written by Harsh Chauhan.

Harsh Chauhan has no position in any stocks mentioned. The Motley Fool owns shares of China Mobile.

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