Dow Jones Business News
S&P's Lower Outlook On Lucent Not Seen As A Surprise
By Paula L. Stepankowsky, Of DOW JONES NEWSWIRES
LONGVIEW, Wash. -(Dow Jones)- News that Standard & Poor's revised its outlook for Lucent Technologies Inc. (LU) downward to negative from stable doesn't appear to be a big surprise on Wall Street.
The information in the S&P news release explaining the reason for the outlook change was based on information already known, said David Toung, an analyst with McDonald Investments.
"So I would think a lot of the information had already been incorporated into the market," said Toung, who doesn't own the stock and whose firm doesn't underwrite it.
Spokesmen for Lucent, Murray Hill, N.J., could not immediately be reached for comment.
After the market closed Monday, Standard & Poor's affirmed its B-plus corporate credit rating on Lucent, but revised its outlook on the company to negative from stable.
Lucent, a supplier of equipment for telecommunications companies, has suffered recently as the company's core customer base continues to defer purchases of new communications equipment, S&P said in the news release announcing its actions.
S&P said industry conditions are not expected to improve materially over the next year.
"Lucent's ability to meet prior revenue targets in light of challenging market conditions had become increasingly problematic by the June quarter, and the company is not providing guidance for the September 2002 quarter," S&P said.
However, Lucent has a good cash position and not much debt coming due soon, said Greg Teets, an analyst at A.G. Edwards & Sons.
"So it shouldn't have any near-term impact," said Teets, who doesn't own the stock and whose company doesn't underwrite it.
Teets said the S&P action doesn't change his opinion on the stock, which he rates hold/speculative.
Lucent shares closed up 2 cents, or 1.3%, at $1.55 Monday on volume of 25.1 million. Average daily volume is 32.9 million shares. |
