To All:
One 1/2 hours after it finally opened late at $32, the stock of NT has fallen to $30.50 and is the second most active on the NYSE. LU is the most active and is also down about $4-5+. That makes the equivalent Bay price $18.25. Been there, done that. Thought I would never have to see this again.
I believe the rev weakness this quarter will come on the NT side, not Bay(consistant with lost wireless contracts in Europe, ALA warning, etc). If true, it shows that for all the positive changes House may have made vs. his predeccesor(Andy Ludwick), he unfortunately repeated the single worst mistake: misexecution of a good strategy. Ludwick saw the coming of mergers in networking, but chose the #2 router company(WFLT) and did the deal when Bay was in a temporary slump(we got .725 shares/SNPX share, even though SNPX was the larger company). Now, House puts Bay into play after missing(badly) the promised good qtr in March. Then, he pushes through the deal in record time, right before the bottom falls out of the telco sector. Like many things in life, timing is everything. Bay has managed to get the timing as wrong as possible twice now, and unfortunately so have I.
Tomorrow I will get a margin call on shares I bought in the past 30 days that I never would have bought without the misleading BS coming from NT about how great everything was going. As I said last night, all the publicity and media play(and Street response) has been focused on the rev warning. NOBODY is talking about the PR spin NT spent all month preparing for; the launch of NortelNetworks. Total waste of time and money.
As much as I hate to say it, the Cisco cheerers have been right all along. It has been the only safe investment in this sector this year; the only one to bounce back from the August debacle. They make their numbers, and they can EXPLAIN their numbers. NT better get better at both in a hurry!
Thanks for letting me vent.
Paul |
