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Technology Stocks : Ascend Communications (ASND)
ASND 202.47-4.5%3:59 PM EST
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To: pat mudge who wrote (38681)3/10/1998 2:55:00 PM
From: Gary Korn  Read Replies (6) of 61433
 
I spoke to IR. Here is my report:

1. It was agreed that it would be fair for either Ashby or Schneider to call me today and that an effort would be made so that that could occur. I'm waiting on that call.

2. This is a busy week at ASND as they are meeting with the investment houses all week before they go into the quiet period next week. (So you know that whatever is being said now is being reflected on the Street).

3. IR is "pretty confident" and "feels good" about nailing 25cents/share. Furthermore, the quarter is going as planned. They knew January would be slow due to the tail end of carrier spending moratorium. That required a bigger finish at the end.

4. However, consistent with some rumor that someone posted here, there are in fact several large orders that are pending that have not yet closed. I tried and tried to get from IR what would be the impact, on earnings, if the orders did not close. The best I could get was that it wouldn't matter if the revenue number were "a couple of million shy or above." (I don't agree with that at all.)

I really want more information on this from someone other than IR, and I will post anything I get, but my guess (purely a guess until I get more on this from Ashby et al.) is that there may be some marginal risk on the 25/share number. It apparently is not cast in concrete but is pretty likely. If there were to be a shortfall, it presumably would be small.

That being the case, I'm guessing that smart money is taking some money off of the table in an exercise of the phrase "discretion is the better part of valor." After all, what would be the Street reaction if they miss by even 1/2 a penny?

I really need to get more information and I'm hoping that someone calls this afternoon.

Other information:

1. The CBX500 has been shipping all along. That is their ATM revenue.

2. It is the GX500 that will only begin to ship, in very marginal amounts, during this 1Q98.

Gary Korn
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