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Technology Stocks : JDS Uniphase (JDSU)
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To: Bill Holtzman who wrote (16011)1/6/2001 7:17:36 PM
From: t2  Read Replies (1) of 24042
 
Bill, I believe the barriers to entry only increase in an economy that is in a downturn.

Remember the CEO of Cisco saying that they are opportunists and will take advantage of a bad capital environment to make strategic buys.

The trend to outsourcing should only increase in the event of a downturn. I cannot image a company like NT expanding their optical component business and tying up their capital. Outsourcing will be an even bigger trend.

My feeling is that JDSU is immune to a mild spending slowdown; more than the electronic contract manufacturers like SLR, CLS, etc...
The reason for the difference is barriers to entry and the fact that optics is a much newer business.
Having stated that, look for JDSU to sell their european optical plant that may be part of a settlement with the DOJ to SLR, Jabil, CLS type. I believe the odds are that these players in other industries will also be interested just as much a Corning.
These other companies will want to diversify their activities and optical may be a good fit.
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