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Technology Stocks : Lucent Technologies (LU)

LU 2.820

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Nov 7 9:30 AM EST

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To: puborectalis who wrote (5006)	11/21/1998 5:50:00 PM
From: Haim R. Branisteanu	Read Replies (1) of 21876

Karasick, sorry to disagree with you but telecom business is like automotive business, and as of today it is a very competitive and financing intensive market. As in TV, and Cars US does not have the lead. Now much more LU does not sells to consumers so it is not a "KO" <ggg> Secondly LU has not entered the CCE and CIS markets with great technical talent and cheap labor. ALA, Siemens and ERICY are all over the place in those countries, supplying telecom equipment manufactured locally at half the price. I know that as I was personally involved in a $50 million project were ALA of Turkey supplied the equipment. LU lost in Mexico to NT based on price and in Brazil LU undercut everyone just to get the project. So sales may be growing nicely but profit margin will lag substantially as they will be schrinking. It will be wrong to asume that earning per share will grow similar to sales per share, and earnings is what counts exept if you are an AMZN or YHOO <ggg> Aside from this most developing countries are protective of their own turf and as Brazil will demand LU to establish local assembly plants which in the big scheme of things is not as profitable and only adds more capacity which in turn lowers prices. BWDIK Haim

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