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Technology Stocks : Terayon - S CDMA player (TERN)
TERN 43.97-2.2%3:59 PM EST
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To: Pluvia who wrote (747)4/17/2000 5:43:00 PM
From: StockDung   of 1658
 
Terayon Plunges on Concern About Status Standard


Santa Clara, California, April 17 (Bloomberg) -- Shares of Terayon Communication Systems Inc., the No. 2 maker of modems for cable-television lines, tumbled 13 percent after questions resurfaced about the company's status in creating an industry standard.

The shares fell 12 1/8 to 81 7/8. That follows a 48 percent drop last week. They've fallen 71 percent since trading as high as 285 1/4 on March 9.

Shareholder Shlomo Birnbaum sued Terayon Thursday, accusing the company of making misleading statements about its proprietary cable-modem technology. The suit charges that the company called its technology that transmits information on cable lines an ``industry standard' when it was only being considered for the designation.

The charges are ``absolutely groundless,' said Terayon Chief Executive Zaki Rakib. ``We will prove they're absolutely wrong.'

The suit seeks class-action status for anyone who bought Terayon shares between Feb. 2 and April 11. It was filed by Milberg Weiss Bershad Hynes & Lerach LLP, one of the most active plaintiffs' law firms.

``People don't necessarily know what to make of it,' said Anton Wahlman, an analyst at Warburg Dillon Read, who rates Terayon a ``hold.'

Wahlman said investors were bringing the valuation of Terayon's shares in line with rivals like Com21 Inc. and Scientific-Atlanta Inc. Terayon shares still trade at 328 times expected earnings, compared with 82 times at Scientific-Atlanta.

Apr/17/2000 17:06

For more stories from Bloomberg News, click here.

(C) Copyright 2000 Bloomberg L.P.
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