Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.
A surprisingly solid second-quarter report paired up with optimistic management comments on longer-term industry trends to trigger a big jump in share prices.
*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.
Alert: Top Cash Back Card Now Offers 0% Intro APR Until Nearly 2027
Enjoy 0% intro APR on purchases and balance transfers for 15 months—plus up to 5% cash back in popular categories.
Motley Fool Returns
Market-beating stocks from our flagship service.
Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 2025-08-29 13:01:49.621598.
Discounted offers are only available to new members. Stock Advisor list price is $199 per year.
Calculated by Time-Weighted Return since 2002. Volatility profiles based on trailing-three-year calculations of the standard deviation of service investment returns.
Shares of Oclaro (OCLR +0.00%) gained 20.7% in February of 2018, according to data from S&P Global Market Intelligence. After a difficult 2017, the maker of optical networking components headed into last month's second-quarter report with low expectations -- and the results ended up impressing Oclaro's investors.
Essentially all of Oclaro's February gains materialized as a direct response to that second-quarter earnings report in the first week. Top-line sales fell 9.5% year over year to $193 million, on par with Oclaro's own guidance. Adjusted earnings declined from $0.21 to $0.14 per diluted share, but your average analyst would have settled for $0.12 per share.
Image source: Getty Images.
The company is ramping up production of new, faster fiber-optic modules at an opportune time. Management expects the challenges facing the fiber-optic networking industry to subside in 2018, followed by a new multi-year period of secular growth. The turning point should fall in the quarter ending in June, which is the final reporting period of Oclaro's fiscal year, when sales are expected to see a return to year-over-year growth.
Oclaro's share prices have now fallen 19% over the last 52 weeks, and that's including the strong February surge. Trading at just 9.5 times trailing earnings and with a clear path back to industrywide growth, Oclaro is a tempting ticker for value-conscious investors right now.