Aviat Networks: Buy, Sell or Hold?

Roth Capital Partners analyst Scott Searle maintained his “Buy” rating and US$38.00 target on Aviat Networks (Aviat Networks Stock Quote, Chart, News, Analysts, Financials NASDAQ:AVNW), arguing that Verizon’s plans to expand its millimetre-wave wireless network could accelerate orders beginning later this year.

In an Oct. 27 report, Searle said Verizon’s third-quarter results reinforced expectations that Aviat will begin shipping against previously announced orders worth US$60-million to US$70-million. He expects shipments to increase in December and accelerate during the first half of calendar 2027, although component shortages could limit near-term deliveries.

Verizon plans to use its millimetre-wave spectrum to offer fixed wireless broadband speeds of one gigabit per second in metropolitan markets, targeting 10 million to 15 million connections as its multi-dwelling-unit program expands.

Searle argued that Verizon’s deployment plans, combined with continued demand for cellular routers and private wireless networks, support his view that Aviat shares are oversold. He also sees a potential opportunity if SpaceX’s Starlink develops a terrestrial wireless network to compete with Verizon, AT&T and T-Mobile.

Industry commentary suggests Starlink has explored leasing access to at least 80,000 cellular sites. Searle estimates such a network could generate at least US$200-million and potentially US$500-million in wireless transmission and backhaul opportunities for Aviat, with deployments potentially beginning in 2028. However, the project remains speculative.

For Aviat’s fiscal first quarter of 2027, Searle expects results broadly in line with consensus, supported by private network demand despite ongoing supply constraints. He also expects improvements in the company’s balance sheet and order activity.

“Additionally, we believe the company has been laser-focused on its continued improvement on the balance sheet (DSOs),” Searle said.

The analyst noted that Aviat trades at less than one times estimated calendar 2027 enterprise value to sales, despite expectations for continued growth in broadband and private wireless markets. “We believe that as AVNW delivers above-market growth with private networks and MDUs, investors will return to this under-followed and underappreciated broadband wireless story,” Searle said.

His US$38.00 target represents approximately 10 times estimated calendar 2027 earnings per share, compared with the previous target methodology based on fiscal 2027.

Searle expects Aviat to generate Adjusted EBITDA of US$53.5-million on revenue of US$467.7-million in fiscal 2027.

-30-