Wireless communication plays an important role to communicate at a distance, both in leisure and in business. In specific business environments, like in the oil and gas, utilities and offshore industries, it is even critical that no disruption at all takes place during the communication as it could result in loss of information that could lead to fatal incidents. Wireless companies that are able to provide absolutely reliable tools will definitely stand out from its competitors. InvestingHaven performed a long research by scanning the following 3 companies and found that either or all of them could be a multi-baggers on the medium to long term. If investors hold long enough, notwithstanding the fact that the company could go bust along the way. That’s the reason why we considered them high risk high reward investment opportunities. So what does not apply here is that the rule of the free shares: we don’t aim to sell part of the position in order to keep free shares, we look at an exit once all positions in these stocks become a multi-bagger.
How to make the chart with our comments actionable? Very simple, we have identified the different resistance areas, and how strong they are. Depending on your risk profile and how keen you are to take profits off the table (timing aspect), you may consider exiting at one specific point or spread over 2 points.
Ceragon Networks (NASDAQ: CRNT) delivers innovative wireless backhaul solutions that help customer to improve operational efficiency, enhance quality of experience, and ensure peace of mind with no interruption. As the #1 wireless backhaul specialist, Ceragon has been leading the industry for over 20 years now. Its revenue generating business comes from FibeAir IP-20 Platform adopting 4.5G & 5G that provide a wide range of configurations and operates at every microwave and millimeter-wave band to match the requirements of diverse network scenarios. It offers flexibility in choosing all-outdoor, split-mount and all-indoor configurations to suit any deployment scenario. Combined with Ceragon’s network management platform, NetMaster, it simplifies operations and provides a perfect platform for end-to-end, high-capacity wireless backhaul networks.
The monthly chart of CRNT shows that price had a potential W formation albeit somewhat skewed.
The bullish scenario for next 4-5 years: if an investor would go long around 2.9, the next major resistance comes in at at 3.5 – 4.3 which will take a while to clear. With economic growth ongoing, 6.9 – 7.6 should be a thin resistance that could be broken easily. 18 – 22 would be the second last stop preventing price from challenging all time high of around 32. So these are the different exit points that one can take depending on the risk profile. On the other hand, the loss protection level is below 2.
VIAVI Solutions (NASDAQ: VIAV) is a global leader in both network & service enablement and optical security and performance products and solutions. The technologies contribute to the success of a wide range of customers – from the world’s largest mobile operators and governmental entities to enterprise network and application providers to contractors laying the fiber and building the towers that keep everyone connected. Viavi has two different business section namely Network & Service Enablement and Optical Security & Performance Products. It helps Service Providers and Enterprises build, test, certify, maintain, and optimize complex physical and virtual networks. Their l specialty products help protect the world’s currency from counterfeiters, enhance the colors we see, and enable advanced technologies such as 3D sensing. Viavi serves wide range of customers from Communications Service Providers, Enterprise, Cloud, & Data Centers, Network Equipment Manufacturers, Network Installation Contractors, Consumer Electronics, Anti-Counterfeiting, Industrial and Aerospace & Government. So long as the economic fundamental is good for the next few years, we foresee much higher price of Viavi.
The monthly chart of Viavi shows a stellar price movement starting in 1994. This incredible move ultimately resulted in a collapse at the climax of 2000 dotcom bubble. By the time when 2008 financial market bottomed in 1st quarter of 2009, price of Viavi almost went back to where it started. For the past 9 years or so, price have been in consolidating range that is bound by the blue resistance line.
Assuming an entry price of 10.2, the immediate resistance lies around 11.82. Once this is breached, 16.7 would be next level. Going by each level, 19.4 and 27 would be part of the resistance for price to reach the median line. Halfway between median line and the peak would be the potential 10 baggers target of around 155. The loss protection level will be 8.40.
Cien Corporation (NASDAQ: CIEN) is a network strategy and technology company, which provides solutions that enable a range of network operators to adopt communication architectures and to deliver an array of services, relied upon by enterprise and consumer end users. The Company provides equipment, software and services that support the transport, switching, aggregation, service delivery and management of voice, video and data traffic on communications networks. The Company operates in three segments: Networking Platforms; Software and Software-Related Services, and Global Services. Built on the most responsive infrastructure in the business, Ciena’s Adaptive Network lets you command complexity by combining intelligent automation, real-time analytics, and the ability to tune a scalable programmable infrastructure via their 5G network. One of the speciality is to obtain real-time data to accurately predict potential network problems and anticipate trends.
The monthly chart of Cien shows that price is trapped in a big fat downtrend channel. Having the same fate with all technology companies that experienced the 2000 dotcom bubble, Cien Corporation is no exception to that rule.
From the peak of ~1000, it fell to 17 within a span of 2 years. And to make things worse, price made two additional lower lows and bottomed in 2009. Since then it has started consolidating into an elongated triangle (drawn) since Apr 2011. Price is testing on the edge of upper triangle resistance for the 4th time.
Bullish scenario: if price manages to hold current levels of around 26.7, the next target will be to break the downtrend resistance and go for 47.6 – 56.6. The ability to break this hard zone could see price propel to 122-151 zone. This would considered to be the hardest of all resistances due to approximately 30 dollar range. A final target of 400 could be install if 122 – 151 zone can be breached. The loss protection level should kick in when price dropped below 23.4.
Investing wisdom with this type of trades
Long term investment carries a lot of uncertainty and risk, not to mention the potential upside profit target. Also, businesses could go bust along the way. This is exactly why InvestingHaven categorizes the 3 stocks as high beta. And, essentially, not even Warren Buffett can predict the future price. We strongly recommend readers and investors to work up how much they are willing to lose should any of the three companies goes bust. This is because only when the risk is spelled out from the onset with the loss protection in bold, any upside profit of 5-10 baggers can be justified.
As too how much to risk is a very subjective question which we will leave for investors to work that out. Because only investors themselves can define their own risk base on their assessment. InvestingHaven does not want to jeopardize our reputation of making too many wrong calls like others. We are more interested in making huge percentage gains by using smallest amount of capital. It is totally understandable that readers and investors do not want to have anything to do with these stocks as our main purpose is to educate readers on how to identify different levels of support/resistance zone for their own benefits. I think everyone of us will be eager to find out how a mere 100 dollar investment on each of these stock can yield/lose just by holding it to about 3-5 years.