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Technology Stocks : Ascend Communications (ASND)
ASND 212.33+1.1%Nov 28 9:30 AM EST
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To: sepku who wrote (28171)12/17/1997 7:43:00 PM
From: Alok Sinha   of 61433
 
I don't think any analysis as far as ASND's near term prospects will yield much useful information. To me what is important is that the CEO, and CFO have recently expressed comfort with estimates. At the CC after last quarter earnings they were much more conservative. I would imagine that they will suffer an irreparable damage to their already eroded credibility with investors if they do not make their numbers. It is the lack of credibility resulting from past misstatements that, inspite of a growth projection between 35-40% (which is the higher end for the industry), the stock currently trades at about 20 times forward P/E compared to 40 for CSCO. In short, these guys cannot afford another "miss".

I, for one would be very surprised if they miss their numbers this quarter, irrespective of Asia related troubles. My guess is they make or excced slightly and then get bought out in the low 40s by NT. A couple of large orders towards the end of last quarter were suppose to ship in this quarter (NTT, UUNet, etc) which is why I think management feels confident of the projections.

We are already coming towards quarter close and the Asia crisis has been with us for the entire quarter, so it should not be a surprise to Mory and Co.
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