To all -Alcatel warned that it won't make earnings estimates and it's in "telecom.eqt business",so it's stock was off 37% today and the not so bright analysts all rushed in to punish the telecom.eqt. sector. Lucent off 3 15/16, even though they said today that they were comfortable with their earnings estimates. NOTL was off 8,probably for just cause, as they had just laid off 3500 workers,and our friend Tellab's was cut 3 1/16.
Now boys read my lips you can't lump all the folks in this sector in the same boat. Alcatel is not in the same category as Tellab's!! Alcatel is huge,is French, with gross revenues of$185 billion per year.In 1992 it earned $1.90/share;in '93=$1.60/share;in '94=$1.00/share and in '95 lost $5.2 billion dollars,in '96 earned $.65/share, '97=$.98/share and in last 12 m. earned a flat $.98/share.
Sure nothing consistent or growthy about that earnings record. Also for the record,they are big in cables,energy,transportation and defence. I'm sure low oil prices and lack of defence spending have something to do with their "steller" record. They, as companies both have some degree of residense in the "african grasslands" called telecom. eqt.,but Alcatel is like a slow lumbering elephant and Tellab's is like a fast cheetah.
DAVE DICKERSON |
