Shares in Harmonic jumped Tuesday as the company won a new contract to supply cable TV network equipment to Charter Communications. Analysts speculated on how much revenue the multiyear pact will bring in for HLIT stock.
Harmonic announced the Charter deal after the market close on Monday. But the company did not disclose the contract's size.
"We conservatively estimate the Charter network upgrade could represent a $350 million hardware opportunity for Harmonic," Jefferies analyst George Notter said in a note to clients. "This estimate includes remote PHY optical nodes (connections that code and decode data) only."
Harmonic had been viewed as the leading contender for the contract because it already provides similar gear to Comcast.
HLIT stock popped 9.8% to close at 14.37 on the stock market today. Harmonic stock holds an entry point of 15.69.
HLIT Stock: Harmonic As The Front-Runner
At Raymond James, analyst Simon Leopold said in his note to clients: "Although we have been vocal in our belief that Harmonic was the front-runner as Charter's key VCCAP (virtual converged cable access platform) supplier, the absence of an official announcement has been a point of concern for investors; today's announcement should remove this overhang."
Leopold added that while Harmonic's prior deal with Comcast initially came in at $175 million over three years, Comcast went on to spend $450 million on Harmonic network gear.
HLIT stock holds a Relative Strength Rating of 92, according to IBD Stock Checkup.
Harmonic stock had been flat in 2023, but was up 38% for the year leading up to the Charter contract announcement.
Follow Reinhardt Krause on Twitter @reinhardtk_tech for updates on 5G wireless, artificial intelligence, cybersecurity and cloud computing.
