Shares of Viavi Solutions Inc. reached a fresh 52-week high in Thursday’s trading session. This upward momentum is being driven by a significant contract secured by its subsidiary, Spirent, with telecommunications giant Vodafone, coupled with a notable surge in bullish options trading activity.
Strong Quarterly Performance Underpins Rally
The current rally builds upon a foundation of robust financial results. In October, the company reported its Q1 FY26 figures, showcasing revenue of $299.1 million. This represents a substantial year-over-year increase of 25.6%. Furthermore, Viavi posted an adjusted earnings per share (EPS) of $0.15, surpassing analyst estimates of $0.13. The company continues to scale profitably, as evidenced by an adjusted gross margin of 60% and an operating margin of 15.7% for the quarter, despite broader sector headwinds.
A Key Contract Validates Strategic Acquisition
Fundamental news is providing concrete support for the share price advance. Industry reports confirm that Vodafone has selected Spirent to automate testing for its European 5G voice core network. This deal serves as a powerful validation of the strategic rationale behind Viavi’s acquisition of Spirent. The integration is projected to contribute approximately $200 million in annual revenue, diversifying Viavi’s business into the high-margin laboratory and security testing segments. It also underscores the company’s strengthened competitive position within the critical 5G infrastructure market.
Should investors sell immediately? Or is it worth buying Viavi?
Options Market Signals Bullish Conviction
Market sentiment is further reflected in unusually high activity in the options market. On December 10th and 11th, traders purchased 5,815 call option contracts. This volume marks a dramatic 209% increase over the average daily volume of 1,881 contracts. Such a pronounced spike in call buying often indicates that sophisticated or institutional investors are positioning for a continued upward move in the stock.
Technical and Fundamental Outlook
During Thursday’s session, the stock price climbed to a high of $19.21, edging close to its absolute annual peak of $19.31. The current trading range near $19.20 now sits significantly above the average analyst price target of $16.89. This divergence may pressure market researchers to re-evaluate their targets to align with the company’s updated fundamental picture.
From a technical perspective, the chart remains bullish as long as the share price holds above the breakout level of $19.00. Looking ahead, the company’s ability to meet its Q2 FY26 guidance—which forecasts an EPS between $0.18 and $0.20—along with securing additional 5G contract wins, will be crucial to justifying its elevated valuation multiples.
Ad
Viavi Stock: Buy or Sell?! New Viavi Analysis from December 11 delivers the answer:
The latest Viavi figures speak for themselves: Urgent action needed for Viavi investors. Is it worth buying or should you sell? Find out what to do now in the current free analysis from December 11.
Viavi: Buy or sell? Read more here...
