However, I would regard JDSU as riskier than Q, because it is not a Gorilla.
These are my 2 biggest holdings (by far) and I have 2x as much Q as J, but I have don't see J as more risky than Q these days.
Three things bother me about Q:
W-CDMA - While Q's position on this is clear (same royalties as CDMA) it seems far less clear among those who don't want to pay the royalties (mostly the Europeans and MOT). I see the risk of a legal quagmire here, since as Dr. J has stated, legal challenges are expected.
China - I hope the recent reports of a CDMA rollout in China are correct. I see a risk of their sticking (mainly) with GSM because of their reluctance to pay royalties.
HDR - Looks good, but there was a statement by a Nortel exec recently that many telcos have their spectrum filled to capacity. Given the rate at which cell voice is expanding, and given the introduction of 1XRTT @ 384 kps late next year (which is plenty fast), seems to me that the telcos would be prudent to have a wait-and-see attitude re HDR. There is limited capacity here so I have trouble seeing why HDR @ $40/month is so attractive to the telcos.
OTOH, I see fewer problems with JDSU these days. (I hope you listened to the ML conference call today.) Huge barriers to competitors, i.e., if you aren't already competing, you are TOAST; and J is 50% bigger than their 3 largest competitors (Ortel, SDI, E-Tek) combined, and growing 50% faster.
By the way, God help JDSU if the Canadian content law ever changes!
I'm not sure what you mean by this. I presume you are talking about the 20% foreign content limit in the RRSP (tax free retirement account). There is hope/talk about this being increased to 30%, but so what? JDSU is probably the last stock that would get dumped if Canadians were allowed to put more $$$ into foreign stocks.
On the subject of socialist Canada, you are unfortunately 100% correct IMHO (my apologies to Rose), particularly here on the left coast. Unfortunately, we have an extreme leftist provincial government in their 6th year (or so). We used to have the best growth among the 10 provinces; now we are last. This provincial government has been running a huge deficit each year they have been in power, and ironically, we are the highest taxed jurisdiction on the continent. Sucks big time; and they don't yet see the light! |
