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Technology Stocks : Ciena (CIEN)
CIEN 210.71+3.3%Dec 18 4:00 PM EST
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To: Jack Hartmann who wrote (9089)6/1/2000 10:43:00 AM
From: Rustam Tahir  Read Replies (2) of 12623
 
Here's an article that comments on Lucent's recent purchase. zdii.com

In it, an analyst from an independent research firm (Pita) makes the comment that second tier companies like CIEN will either have to start acquiring companies or be acquired. Whatever they do, they will have to start spending in order to get big. Any comments?

Since the Tellabs fiasco, I have been of the mind that CIEN needed to remain independent. I think that management has done a great job, but the latest quarterly report suggested some weaknesses. We've discussed them previously, especially EdgeDirector's (That's the one right?) minimal contribution to revenues. Being small has its obvious advantages in a fast growing industry. So does being folded into a larger company. Weaknesses aren't as magnified and products that are ahead of their time can have the luxury of waiting until the market is ready without stalling momentum (as would be the case in a smaller company). Is CIEN at the stage where it begins to make more sense to become bigger rather than remaining independent? Does CIEN have the wherewithal to buy smaller companies? The Lightera and Omnia acquisitions were gifts that I doubt exist now in the superheated marketplace. So I don't know if acquisition is the right way to go from a financial standpoint. Being bought out might now be a viable option to consider as a way to solidify the future.

rustam
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