I filched this from the SDLI Club on Yahoo. Thanks to buysdli for posting it. And I love the last paragraph too.!!
kat
I love the last paragraph of this article. :)
GO LONG SDL.......
SDL's Wild, Woolly Wednesday
Mar. 07, 2000 (Fiber Optics News, Vol. 20, No. 10 via COMTEX) --
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Veritech fills SDL's glaring weakness in high-performance OC-192, 10 Gbps module level transmitters and receivers, and should satiate SDL's dense wavelength division multiplexing customers.
Veritech's technology should take SDL toward the OC-768 40 Gbps systems of the future, says Donald R. Scifres, CEO and chairman of SDL.
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With viable acquisition targets dwindling, SDL has to be near the top of many lists, says analyst David Kang of San Diego-based Cruttenden Roth, an investment banking firm.
"Buying Veritech really strengthens SDL's transmitters and receivers, which was their main weakness area," says Kang, who has a buy rating on SDL with a price target of $488. "That's why they acquired [UK-based] IOC International plc last March 31 [for $50 million] and this is the second major
acquisition for them. Right now they're very strong in the amplifier area and very weak in receivers, especially compared to JDS Uniphase, which has a very strong presence in all three areas."
Curiously, the IOC acquisition came just six days after SDL announced a 2-for-1 stock split, similar to the pattern of announcements last week.
Perhaps Scifres just likes proving that "good things come in twos." After all, it's been two straight years now that SDL has been profitable, showing a net of $25.2 million ($0.74 EPS) in 1999 and $12.8 million ($0.44 EPS) in 1998.
That gives SDL six profitable years out of the last eight, an impressive record in today's age of company war cries echoing "Don't worry about profit, just buy our stock!"
"We envisioned a successful company, and this is quite successful obviously," Scifres says. "We began in 1983 through 1990 primarily developing semiconductor lasers for satellite communications markets, which really led us into fiber optic communications.
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James E. Jungjohann of New York-based CIBC got into SDL stock when it was at $7.50 back in Aug. 1998. He doubts anyone will buy SDL because its is simply not for sale.
"Everyone has tried to buy that company," says Jungjohann, who has a "strong buy" rating on SDL. "But Donald [Scifres] has a great fundamental story he's sticking with. He's not willing to sell."
www2.marketwatch.com
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