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Investing.com - Needham lowered its price target on Harmonic Inc . (NASDAQ:HLIT) to $12.00 from $14.00 on Tuesday, while maintaining a Buy rating on the stock amid continued weakness in cable upgrade spending. According to InvestingPro data, the stock currently trades at $9.14, down nearly 31% year-to-date, though analysis suggests the stock may be undervalued at current levels.
The video delivery infrastructure company’s Broadband revenues missed $100 million for the seventh time in ten quarters, reflecting the ongoing slowdown in cable operator investments.
Despite these challenges, Harmonic managed to beat lowered second-quarter revenue and EPS estimates by 8% and $0.07 respectively versus consensus. However, the company provided cautious guidance once again, 16% below revenue consensus and $0.07 below earnings consensus.
Needham noted that Harmonic’s performance remains heavily dependent on its two major customers, Comcast (NASDAQ:CMCSA) and Charter, whose upgrade programs have largely stalled despite these initiatives being described as "strategic and vital" to the operators.
The research firm indicated it still believes in its investment thesis for Harmonic but expects the turnaround to be delayed until fiscal 2026, prompting the reduction in estimates and price target.
In other recent news, Harmonic Inc. reported impressive second-quarter results for 2025, surpassing both earnings and revenue expectations. The company achieved an earnings per share (EPS) of $0.09, far exceeding the anticipated $0.02, resulting in a 350% surprise. Revenue figures also outperformed predictions, reaching $138 million compared to the forecasted $127.73 million, marking an 8.04% increase. These figures highlight a strong performance for Harmonic in the recent quarter. Additionally, following the announcement of these results, the company’s stock experienced a rise in aftermarket trading, indicating positive investor sentiment. While specific stock price movements are not discussed, the overall outlook from analysts remains positive. The company’s ability to exceed forecasts in both earnings and revenue is a key highlight for investors. These developments reflect a significant achievement for Harmonic in the competitive market landscape.
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