4-Star Stocks Poised to Pop: Ubiquiti Networks

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, wireless networking equipment specialist Ubiquiti Networks (Nasdaq: UBNT  ) has earned a respected four-star ranking.

With that in mind, let's take a closer look at Ubiquiti's business and see what CAPS investors are saying about the stock right now.

Ubiquiti facts

Headquarters (founded) San Jose, Calif. (2003)
Market Cap $754.1 million
Industry Communications equipment
Trailing-12-Month Revenue $353.5 million
Management Founder/CEO Robert Pera
CFO John Ritchie
Trailing-12-Month Return on Capital 62%
Cash/Debt $122.1 million / $29.6 million
Competitors Alvarion
PC Tel
Proxim Wireless

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 88% of the 51 members who have rated Ubiquiti believe the stock will outperform the S&P 500 going forward.  

Just last week, one of those Fools, All-Star TSIF, offered a cautiously optimistic take on Ubiquiti's recent struggles with counterfeiting:

There is worse news than copycats copying your technology and dumping it on the market, but I can see why that would make investors nervous. Ubiuiti Networks indicated that it was "on top" of the problem and should have it resolved in the next two more quarters. ...

Ubiquiti Network plans a $100 Million stock buyback to help counter the impact to the share price plunge, but if it does so, it will be buying with mostly borrowed money on its revolver. Not necessarily a good practice, but it could work if they maintain profitability during the "crisis". ...

Spec play, falling knife. With other analysts I think this will take several quarters to clear, but copycats do help show the value of Ubiquiti Networks products.

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Fool contributor Brian Pacampara owns no position in any of the companies mentioned. Try any of our Foolish newsletter services free for 30 days.

We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Fool's disclosure policy always gets a perfect score.


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