26 Oct This Week’s Rising Star: Calix, Inc.
This week’s rising star is Calix, Inc. (CALX). CALX manufactures and sells carrier edged devices, such as WiFi routers, primarily to large communication service providers. In fact, CALX has the fourth largest market share among edge equipment providers:
While CALX only holds a 5.78% market share in the space, it has been one of the most rapidly growing companies in the industry, and as such, we believe it is poised to become one of the leaders in the space.
Edge Equipment Market Share
Market share data for “General Carrier Edge Equpment” per FactSet’s RBICS classications, as of 09/30/21
Top 10 Year-Over-Year Market Share Growers
Market share data for “General Carrier Edge Equpment” per FactSet’s RBICS classications, between 09/30/20 and 09/30/21
As you can see, CALX has grown its market share by nearly a third from a year prior and was the third fastest growing company by that metric in the space. This is an encouraging trend for a company that is aspiring to become a potential leader in the space.
However, aside from the recent numbers, we believe there are other encouraging facets for CALX. MidSouth Fiber, a subsidiary of MidSouth Electric Cooperative, recently announced that it achieved a 248% increase in the adoption of CALX’s mobile app, CommandIQ’s. CommandIQ is a mobile based app, created by CALX, that allows consumers to administer controls of their WiFi router, such as resetting their WiFi password or setting parental controls and other security restrictions on their network, through their smart phone. As cybersecurity becomes more prevelant in our every day lives, we believe that providing a convienent way for consumers to manage internet security settings adds a lot of value. This is an example of the forward level thinking from CALX management.
CALX also recently announced that its $1 billion project over the past decade to provide an end-to-end solution for broadband service providers is now being unveiled. As we see more companies across all industries develop direct to consumer options (e.g.: content creators developing their own streaming platform or former politicians creating their own social media platform), service providers are starting to feel the pinch. CALX believes their end-to-end solution for broadband service providers will allow them to integrate all CALX platforms and provide those service providers with more comprehensive consumer data that will improve the company’s customer service and marketing efforts. Access to consumer data is becoming more important in the sales process of every industry, and this is no different. This is a great example of CALX creating solutions for its clients and innovating within their current offerings.
Overall, we believe the numbers are showing that CALX is well positioned for continued growth within its industry, and as a result, is a rising star in the making. Furthermore, its focus on improving and modernizing its products and services will continue to enable the company to become a leader in the space. CALX is up 79.10% year-to-date through 10/21/21.
Rising Stars: Rapidly emerging companies that indicate the next generation of growth stocks.
Top 10 Holdings and Factsheet: GBGR
Factset Rising Stars Index is composed of stocks listed on the NYSE and Nasdaq that demonstrate market share expansion in the fastest growing technology industries.
FactSet Research Systems Inc. is a global provider of integrated financial information, analytical applications and services for the investment and corporate communities.
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