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Technology Stocks : Foundry Networks, Inc. FDRY

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From: mopgcw	4/22/2006 4:07:53 AM
	of 1225

Foundry Stock Falls on Disappointing 1Q Friday April 21, 2:14 pm ET Shares of Foundry Tumble on Earnings That Missed Wall Street Expectations NEW YORK (AP) -- Shares of Foundry Networks Inc. fell Friday after the maker of network switches and routers posted a first-quarter profit that missed Wall Street expectations, and an analyst cited his concern about competition within the sector. ADVERTISEMENT Foundry stock tumbled $1.96, or 11.5 percent, to $15.10 in afternoon trading on the Nasdaq. On Thursday the company reported a profit of $17.4 million or 12 cents per share -- excluding stock options -- which was a penny shy of analysts' estimates. Prudential Equity Group analyst Inder M. Singh was concerned that competitors would draw attention away from Foundry and its newer products with their own system upgrades and price cuts. "As one of the smaller players in this market relative to the likes of Cisco, Juniper and Alcatel, we believe there is some risk that Foundry will need to execute flawlessly in order to avoid getting squeezed by its larger, deep-pocketed competitors," Singh said in a note to investors. Singh maintained an "Underweight" rating on the stock with a price target of $14. However, Pacific Growth Equities analyst John Mark Duncan said the company's disappointing results were a "minor hiccup" because of first-quarter seasonality and ongoing challenges of a rapidly growing company. "We remain bullish on the prospects for Foundry, as we believe the Ethernet switching and routing market is benefiting from a rich enterprise spending environment and a migration to Ethernet technologies among service providers," Duncan said in a note to investors. Duncan said he believed the company's sales force should reach full productivity by the second half of 2006 and reiterated a "Buy" rating on the company's stock with a price target of $17.06. Over a 52-week range, the stock has traded from $7.95 to $18.32.

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