DragonWave (DRWI)

[ciciagt]

July 9, 2010, 11:45 AM ET.DragonWave Rebounds; Mizuho Upgrades To Outperform Rating.

By Eric Savitz
DragonWave (DRWI) shares, which were clobbered earlier this week after the telecom equipment company issued much-worse-than-expected guidance for its August quarter on a big drop in revenue from Clearwire (CLWR), today has staged a smart rebound. Providing support to the stock: Mizuho Securities analyst Joanna Makris, who this morning upped her rating on the stock to Outperform from Neutral.

“With Clearwire expected to resume its build out and DragonWave still in the catbird’s seat here, we believe the next quarter or so represents a temporary speed bump in a good fundamental story,” she writes in a research note. “While we don’t have all the answers, we believe valuation is too compelling to ignore for a market segment in the early innings of a multi-year growth cycle.”
Makris notes that excluding $3.15 a share in cash, the stock trades at 0.4x estimated FY 2012 sales.