Technology

Analysts Mostly Positive on Acacia Communications After Quiet-Period Expiration

Jon C. Ogg

Published: June 7, 2016 10:45 am

Last Updated: January 13, 2020 7:06 am

Acacia Communications Inc. (NASDAQ: ACIA) has done quite well since its initial public offering in May. Now the quiet period has ended for the provider of high-speed coherent interconnect products and the analysts from the underwriting syndicate have initiated coverage.

What stands out here is that Acacia Communications was last seen trading at more than $39, up over 50% from the initial $23 per share pricing. That price was also at the higher end of the $21.00 to $23.00 range that had been indicated by the underwriting syndicate.

Another issue was that only 4.5 million shares were initially sold, so the float is low. Acacia Communications had top venture capital investors behind it: Matrix Partners, Commonwealth Capital Ventures, as well as Summit Partners.

Investors know that this is a serious growth company. Acacia’s revenue in 2015 was $239.1 million, which was up more than 63% from its revenues of 2014.

24/7 Wall St. wanted to see how the analysts initiated coverage on Acacia. For the most part the ratings are positive:

• Merrill Lynch started it with a Buy rating and $44 price objective.
• Cowen started it with an Outperform rating and $53 price target.
• Deutsche Bank started it with a Buy rating and $50 price target.
• Goldman Sachs started it with a Neutral rating and $39 price target.
• Needham started it with a Buy rating and $48 price target.

Northland Capital Markets was listed as a co-manager in the syndicate as well. Unfortunately, we have not seen that firm’s official rating and price target yet.

Acacia Communications traded up 1.7% at $36.50 in the premarket on Tuesday. Then the stock was up 9% at $39.13 mid-morning on Tuesday. Its post-IPO range is $27.05 to $43.10.