Serenity: The recent plunge in silicon photonics stocks is actually a buying opportunity; SIVE and AAOI fundamentals remain unchanged, and mass production prospects remain promising.
According to BlockBeats on June 26, in response to the recent sharp share price pullback of a certain exchange, Serenity made a contrary statement, saying that the price drop actually made them "more bullish than ever" and elaborated on the investment logic behind both companies.
For the exchange in question, with a current market capitalization of about $1.9 billion, Serenity believes it plays a key role as a "bottleneck supplier" of lasers in the silicon photonics supply chain. Its partners include reference lasers for GlobalFoundries, Ayar Labs' co-packaged optics (CPO) expansion in the NVIDIA NVLink ecosystem, as well as POET and Jabil and other supercomputing suppliers, with a gross margin of about 60%.
Recent numerous bearish reports by Swedish media and a 15% share dilution actually stem from Nasdaq floating share arrangements and M&A authorizations, not a deterioration of fundamentals. The roughly $140 million convertible notes are "a drop in the bucket" for U.S. institutional investors. He believes the exchange's priority on advancing its Nasdaq listing is the right strategy to avoid interference from local media noise.
For the other exchange, with a current market capitalization of about $10 billion, the company expects monthly revenue to reach $471 million going into the second half of 2027. Supercomputing companies such as AMD are reportedly negotiating long-term agreements (LTAs). Previously, through an ATM stock issuance plan, approximately $1.4 billion in funding was raised, and cash reserves are ample.
Serenity compares the current situation to last year’s case where Nebius (NBIS) plunged from $70 and then rebounded above $250 as its performance delivered. They believe photonics stocks are generally more volatile than other tech stocks, and it merely requires waiting for both companies' ramp-up production data to materialize.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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