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Resonant schedules 1Q19 plus CUI and macro ?3


Resonant has scheduled its first quarter report for Wednesday, May 8th, after market close.  5 analysts are covering the company and the average of their estimates comes to a loss of 19 cents per share on revenue of $338K, which is expected to almost double to $640K in the current quarter.

Yesterday's MACOM JV affirms that China is 1-2 years ahead of the west in 5G deployment.  That's good for Resonant in principle, but the stock was already more on the knife's edge than any other GRoDT, which means there probably won't be any effect on RESN pricing.  The company cuts a deal or dilutes; either way it's the terms that matter, and the possibilities are not exclusive.  In situations like this, time is the enemy and that can make it hard to capitalize. Resonant management clearly can't/won't go to the lengths that CUI's has to avoid dilution, so ramping revenue becomes all the more important.  We learned this morning that CUI's sales relationship SAMSON is finally beginning to bear unquantified fruit toward that same goal, but we need numbers from both companies.

With negotiators heading back to Beijing on Tuesday, Resonant's fate may come down to whether the west really wants to catch up, or just continue to issue delusional sound bytes and expensive spectrum auctions.  Network operators like Vodafone are doing a good job optimizing other costs in preparation for 5G, but to the extent they are forced to cut Huawei out of their supply chains, even if for good reason, progress will be slower and more expensive.  So far the soap opera is not helping western companies like Nokia, and what will matter for the long term is how much other countries like Taiwan, Japan, Korea, and India are pushed toward greater cooperation with either Europe or China.  Right now, it's looking like things come to a head by June, both in Resonant's balance sheet and the broader world.  The latter depends on the U.S., U.K. and E.U. ceasing their delays, though.  They're not helping anyone by bickering.