Investment bank RBC Capital Markets analyst Daniel Meron upgraded his recommendation on WiMAX equipment and system developer Alvarion Ltd. (Nasdaq: ALVR; TASE: ALVR) to "Outperform", citing "improved business tone and contract activity with new and prospective customers." Meron believes that Alvarion is getting more orders from existing and new customers.
Meron believes that Alvarion is getting more orders from existing and new customers. He finds that Alvarion is strategically targeting the Indian market, gaining an edge with telecommunications firm BSNL. He also sees strong demand for broadband connectivity in developing countries, including ongoing licensing grant process and RFP's in Indonesia, Brazil, Ireland, and Australia.
In India, Alvarion is one of the winners in the nationwide WiMax project to cover the country with a planned 7,000 base-stations, along with other players Gemini Communications, Harris-Stratex and ZTE.
RBC believes that Alvarion has been in negotiations with other leading Indian carriers, and that to support the increased activity the company will be opening a local office and started hiring employees.
Meron also sees potential in the US. "We also see improving prospects for deployments with prime US customer OpenRange: while deployments so far were limited in scope, we believe the company is in advanced planning phases and the project is picking up steam, oiled with pending US Rural Utilities (RUS) funding. We believe we're set to see more substantial order intake during the first half of 2010 with revenue to follow in the second half."
RBC sees strong demand for broadband connectivity in developing countries and rural areas of developed countries to drive the company's growth in coming years, and estimates the WiMax market at a total addressable market of $1.5 billion. RBC believes the market may grow to $3-4 billion in the next few years.
Published by Globes [online], Israel business news - www.globes-online.com - on January 25, 2010
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