Core Insights - Ubiquiti's shares increased by 25.1% in September, outperforming the S&P 500 and Nasdaq indices, which returned 3.7% and 5.7% respectively [1][3] - The stock's strong performance was driven by positive momentum from a strong fiscal Q4 earnings report released in late August [3][5] Financial Performance - In fiscal Q4, Ubiquiti's revenue rose 50% year over year to $759.2 million, with enterprise technology revenue increasing by 58% to $680.1 million and service provider technology revenue growing by 4% to $79 million [6][8] - Earnings per share (EPS) based on GAAP increased by 56% year over year to $4.41, while adjusted EPS surged 103% to $3.54, significantly exceeding Wall Street's expectation of $2.23 [6][8] Dividend and Stock Buyback - Ubiquiti raised its quarterly dividend by 33% to $0.80 per share, marking the first increase since 2021, with the new dividend payable on September 8 [7][10] - The company initiated a stock repurchase program authorizing the buyback of up to $500 million of its common stock [8]

Company Overview - Ubiquiti Inc. (UI) currently holds a Momentum Style Score of B, indicating a positive outlook based on its price change and earnings estimate revisions [3][12] - The company has a Zacks Rank of 1 (Strong Buy), suggesting strong potential for outperformance in the market [4][12] Price Performance - Over the past week, UI shares have increased by 2.27%, while the Zacks Wireless Equipment industry has decreased by 0.37% [6] - In a longer time frame, UI's monthly price change is 19.94%, significantly outperforming the industry's 7.76% [6] - Over the past quarter, UI shares have surged by 69.61%, and over the last year, they have gained 200.71%, compared to the S&P 500's increases of 8.19% and 19.01%, respectively [7] Trading Volume - The average 20-day trading volume for UI is 176,059 shares, which serves as a baseline for price-to-volume analysis [8] Earnings Outlook - In the past two months, one earnings estimate for UI has moved higher, while none have moved lower, resulting in an increase in the consensus estimate from $9.29 to $12.05 [10] - For the next fiscal year, one estimate has also moved upwards with no downward revisions during the same period [10]

Core Insights - Artificial intelligence (AI) is identified as the greatest investment opportunity of the current era, with a strong emphasis on the urgent need for energy to support its growth [1][2][3] - A specific company is highlighted as a key player in the AI energy sector, owning critical energy infrastructure assets that are essential for meeting the increasing energy demands of AI technologies [3][7][8] Investment Landscape - Wall Street is investing hundreds of billions into AI, but there is a looming question regarding the energy supply needed to sustain this growth [2] - AI data centers, such as those powering large language models, consume energy equivalent to that of a small city, indicating a significant strain on global power grids [2] - The company in focus is positioned to benefit from the surge in demand for electricity driven by AI, making it a potentially lucrative investment opportunity [3][6] Company Profile - The company is described as a "toll booth" operator in the AI energy boom, collecting fees from energy exports and benefiting from the onshoring trend due to tariffs [5][6] - It possesses critical nuclear energy infrastructure assets and is capable of executing large-scale engineering, procurement, and construction projects across various energy sectors [7][8] - The company is noted for being debt-free and holding a significant cash reserve, which is nearly one-third of its market capitalization [8][10] Market Position - The company has an equity stake in another prominent AI venture, providing investors with indirect exposure to multiple growth engines in the AI sector [9] - It is trading at a low valuation of less than 7 times earnings, which is attractive given its involvement in both AI and energy [10] - The company is recognized for its real cash flows and critical infrastructure ownership, distinguishing it from other firms that may be overvalued or heavily indebted [11][12] Future Outlook - The ongoing AI infrastructure supercycle, combined with the onshoring boom and a surge in U.S. LNG exports, positions the company favorably for future growth [14] - The influx of talent into the AI sector is expected to drive continuous innovation and advancements, further solidifying the importance of energy infrastructure [12][13]

Core Insights - Ubiquiti is positioned for sustained, profitable growth, having surpassed previous performance expectations in the last three quarters [1]. Company Performance - Ubiquiti exceeded the high end of performance expectations as noted in the previous analysis from December 2024 [1]. Management Background - Michael Huber, the Founder of Lavien and Portfolio Manager, has over 15 years of experience in private and public equity investing, and serves as President and Managing Principal at Quadrangle Group [1].

Core Insights - Ubiquiti is positioned for sustained, profitable growth, having surpassed the high end of previous performance expectations in the last three quarters [1] Company Overview - Ubiquiti's recent performance indicates strong market positioning and growth potential, suggesting a favorable outlook for investors [1]

Core Insights - The telecom sector has shown an 11% gain in 2024, but it has underperformed compared to the broader market, with the S&P 500 increasing by approximately 25% and the NASDAQ by nearly 30% [1] Industry Overview - The telecom industry has experienced periods of significant revenue growth, initially driven by wireline services and later by mobile connectivity and broadband internet. Outside these high-growth phases, the sector is generally characterized by steady but slower revenue growth, typically in the single digits, with global average dividend yields around 4% [2] - Future expectations for telecom companies include a focus on cost reductions, careful capital spending management, monetizing past investments, and leveraging mergers and acquisitions to enhance value. Companies with a growth focus may seek to accelerate revenue beyond traditional connectivity services [3] Methodology for Stock Selection - The stock selection process involved scanning Insider Monkey's database of nearly 1,000 hedge funds as of Q2 2025, identifying telecom sector stocks that pay dividends, and ranking them based on the number of hedge fund investors [5] Company Highlights - **TELUS Corporation (NYSE:TU)**: - Ranked among Canada's top telecom providers, TELUS benefits from a subscription-driven model that ensures consistent revenue. The company has a strong dividend growth record, having raised payouts for 21 consecutive years, currently offering a quarterly dividend of $0.4163 per share and a dividend yield of 7.66% as of September 24 [7][8] - TELUS is investing approximately $70 billion through 2029 to enhance its 5G and broadband networks, aiming to support customer growth and service quality [9] - The healthcare division, TELUS Health, is experiencing solid momentum due to strategic investments and innovative offerings [10] - **Ubiquiti Inc. (NYSE:UI)**: - A networking technology firm that serves clients in over 75 countries, Ubiquiti employs a community-driven marketing strategy rather than a large direct sales team. The company has maintained a solid dividend policy since 2018, increasing its quarterly dividend by 33.3% to $0.80 per share in August, resulting in a dividend yield of 0.50% as of September 24 [11][13] - **Iridium Communications Inc. (NASDAQ:IRDM)**: - Provides global satellite-based voice and data services through a network of 66 low Earth orbit satellites, focusing on government contracts and expanding into new areas like direct-to-device satellite connectivity. Iridium initiated its dividend policy in 2022, currently offering a quarterly dividend of $0.15 per share and a dividend yield of 3.44% as of September 24 [14][15][16]

Core Viewpoint - Momentum investing focuses on following a stock's recent price trends, aiming to buy high and sell higher, with the expectation that established trends will continue [1][2]. Company Overview: Ubiquiti Inc. (UI) - Ubiquiti Inc. currently holds a Momentum Style Score of B and a Zacks Rank of 2 (Buy), indicating strong potential for outperformance [3][4]. - The stock has shown significant price appreciation, with a 53.74% increase over the past quarter and a remarkable 204.99% gain over the last year, compared to the S&P 500's 8.64% and 21.49% respectively [7]. Price Performance - Over the past week, Ubiquiti's shares increased by 9.26%, while the Zacks Wireless Equipment industry rose by 1.17% [6]. - The monthly price change for Ubiquiti is 25.47%, significantly outperforming the industry's 4.77% [6]. Trading Volume - Ubiquiti's average 20-day trading volume is 215,583 shares, which serves as a bullish indicator when combined with rising stock prices [8]. Earnings Outlook - In the last two months, one earnings estimate for Ubiquiti has increased, raising the consensus estimate from $9.23 to $9.29, with no downward revisions during the same period [10]. - For the next fiscal year, one estimate has also moved upwards, indicating positive sentiment regarding future earnings [10]. Conclusion - Given the strong momentum indicators and positive earnings outlook, Ubiquiti Inc. is positioned as a solid momentum pick for investors [12].

Core Viewpoint - Ubiquiti's recent stock surge of over 30% is attributed to a significant business turnaround after overcoming supply chain challenges, leading to record revenue and improved profitability [2][3][4]. Financial Performance - Ubiquiti reported record quarterly revenue of $759.2 million, exceeding analyst estimates of $618.8 million, marking a 49.6% year-over-year increase [4]. - For the full fiscal year 2025, Ubiquiti achieved $2.6 billion in revenue, a 33.4% increase compared to the previous year, indicating a successful operational recovery [5]. - The company's GAAP gross margin improved to 45.1% from 40.2% a year ago, reflecting enhanced financial health [6]. Management Actions - Ubiquiti announced a 33.3% increase in its quarterly dividend to 80 cents per share, signaling confidence in sustained cash flow [9]. - The company initiated a stock buyback plan, authorizing the repurchase of up to $500 million of its shares, further indicating management's belief in the company's value [9]. Market Sentiment - Prior to the earnings report, over 13% of Ubiquiti's publicly traded shares were sold short, creating a situation where negative sentiment contributed to the stock's explosive rally following the positive earnings announcement [10][11]. - The combination of strong performance and negative sentiment led to a significant market reaction, as short sellers were forced to buy back shares, further driving up the stock price [11]. Future Outlook - With operational issues resolving, profitability restored, and robust demand, Ubiquiti is well-positioned for future growth, marking the beginning of a new chapter in its business story [12][13].

Core Insights - Ubiquiti, Inc. reported strong fourth-quarter fiscal 2025 results, with both revenue and net income exceeding Zacks Consensus Estimates, driven by robust demand in the Enterprise Technology segment [1][10] Financial Performance - Net income for the quarter was $266.7 million or $4.41 per share, a significant increase from $103.8 million or $1.72 per share in the same quarter last year, despite higher operating expenses [2] - For fiscal 2025, net income rose to $711.9 million or $11.76 per share, compared to $349.9 million or $5.79 per share in 2024 [3] Revenue Growth - Net sales in the quarter increased to $759.2 million from $507.5 million year-over-year, surpassing the consensus estimate by $144 million [4][10] - The Enterprise Technology segment generated $680.1 million in revenues, up from $431.7 million in the prior-year quarter, exceeding estimates [5] - Service Provider Technology revenues increased to $79 million from $75.7 million year-over-year, driven by strength in North Europe, the Middle East, and Africa [6] Regional Performance - North America revenues were $379.9 million, up from $253.3 million in the year-ago quarter, while EMEA revenues reached $303.8 million, up from $194.1 million [7] Profitability Metrics - Gross profit for the quarter was $342.7 million, with a margin of 45.1%, compared to $204.1 million and 40.2% margin in the prior year, driven by a favorable product mix [8] - Operating income increased to $261.4 million from $138.3 million year-over-year [9] Cash Flow and Liquidity - Ubiquiti generated $640 million in cash from operating activities in 2025, compared to $541.5 million in the prior year [11]

Core Insights - Ubiquiti Inc. reported strong fiscal Q4 results for the April-June period, with accelerated growth and strong margins that surprised the market, leading to a 31% increase in stock price for the day [1] Financial Performance - The company demonstrated significant growth in its enterprise networking segment, which contributed to the positive market reaction [1] Market Reaction - The stock price surged by 31% following the announcement of the fiscal Q4 results, indicating strong investor confidence and market optimism regarding the company's future prospects [1]