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Strategies & Market Trends : Stocks Crossing The 13 Week Moving Average <$10.01

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To: Bucky Katt who wrote (11060)	5/28/2002 9:06:10 PM
From: xcr600	Read Replies (1) of 13094

Journal paints grim picture for Nortel, JDS CTVNEWS.com Staff Tue. May. 28 2002 9:06 AM The respected financial magazine, Barron's, says the worst may still be ahead for Nortel and JDS Uniphase. The publication has included the high tech giants among a list of companies it says could completely collapse. Washington-based analyst Scott Cleland says "a combination of financial and operating problems makes the future unstable" for Nortel, JDS, and others among a list of companies entering "the insolvency zone." Broker Gerry Robideau of Edward Jones Investments says although it's premature to throw in the towel, Nortel needs to see a turnaround in telecom spending in the next 12 to 18 months. "Based on the heavy debt they've got and drying up of demand for their products, that possibility does exist," he says. You don't have to look very far to figure out why Nortel has been added to this list: Two of its biggest customers -- AT&T and Sprint -- are also in the "insolvency zone." "They need to pull back and get their financial house in order. And at the same time, overcapacity needs to be used up," Robideau says. The same concerns have landed JDS Uniphase in the "insolvency zone" as well. But Robideau is not so sure he agrees "Stating that a company has a risk of insolvency when it has $1.6 billion in cash and no debt is a little hard to envision," he says. If telecom spending doesn't recover in time, both Nortel and JDS Uniphase have options to fend off a worst-case scenario, such as cutting more staff or issuing more shares and bonds.

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