Ascend Communications-News Only!!! (ASND) Message Board

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Technology Stocks : Ascend Communications-News Only!!! (ASND)

ASND 197.59

-0.8%

Nov 7 9:30 AM EST

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To: Dennis R. Duke who wrote (1379)	4/18/1998 1:42:00 PM
From: Dennis R. Duke	Read Replies (2) of 1629

Cowen & Co. likes ASND with the new LCI order, too. This item is from Wednesday, (sorry for the delayed post, taxes got in the way). They did not change price targets or estimates but wrote the following: Key Points: 1. ASND Wins Deployment Of Approx. 40 Frame Relay And ATM Switch Deployment At LCI. 2. We Estimate The Deal Value At $5MM To $10MM. 3. LCI Deal Is Incremental To Prospective Qwest Deal For Core Switches. 4. Maintain Buy Rating And $45 Target Price. Estimates Unchanged. Thesis/Valuation: ASND is a dominant player in the Internet access concentrator market and it has a strong position in the ATM switch and frame relay markets. The company will be one of the most significant infrastructure suppliers for the explosion in spending on next generation carrier voice and data networks. While the access concentrator and frame relay switch markets appear poised to grow 10 to 20% annually, the ATM switch market is exploding and ASND's CBX500 and GX550 products are achieving significant deployments in carrier backbones. [ASND's Core Switching business could grow faster than the Networkers in general is how I read this. Ashby said it would cross over to more than 50% of the business soon, which this report supports.] Recently, momentum is strong at ASND with the award of several large multi-year deals. We rate ASND shares a Buy-2, with a $45 Target Price, based on 30x C99 EPS of $1.50. ASND Wins Frame Relay And ATM Switch Deployment At LCI. Win Additive To Potential Qwest Deal. LCI announced today that it intends to deploy some 40 ASND frame relay (BSTDX 9000) and ATM switches (CBX500) in its network. We believe that these will deploy in the following two to three quarters and that the total value of the deal is between $5MM and $10MM. On its Q1:C97 earnings conference call, the company said that it is in discussion about deployment of its core switches at Qwest. Qwest is in the process of buying LCI. We believe that the deal announced today with LCI is incremental to the prospective deal at Qwest. ----------- Core Switching to have better than access concentrator and frame relay growth. I like that. QWEST could be the next big contract. I'll be watching for that. Good reading, Dennis

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