(UPDATE) Advanced Fibre Reportedly Close To Naming New CEO, Signing Key Deal
Dow Jones Online News, Wednesday, March 31, 1999 at 15:17
NEW YORK -(Dow Jones)- Shares of telecommunications-equipment maker
Advanced Fibre Communications Inc. surged Wednesday on talk the firm is
close to naming a new chief executive after a nine-month search.
In afternoon trading, Advanced Fibre (AFCI) shares were up $2.063, or
27%, at $9.563 on Nasdaq volume of 6.5 million, compared with daily
average volume of 2.4 million.
Talk of a new CEO "is probably the near-term catalyst," said analyst
David Karson of Black & Co. in Portland, Oregon. The company's former
chief executive, Carl Grivner, resigned last June. Chairman Don Green is
serving as CEO until a new top executive is named.
Karson and other analysts also cited widespread expectations that the
Petaluma, Calif.-based firm will soon announce a much-anticipated
contract with one of the Baby Bells. The company hasn't identified the
prospective customer, but there has been speculation that it is SBC
Communications Inc. (SBC), Karson said. The contract would be an
important financial and strategic milestone, analysts said.
Advanced Fibre's stock, which reached a 52-week high of $44.75 April
20, has been trading in the single digits as it struggled with
disappointing earnings, the chief executive vacancy and allegations that
former employees engaged in insider trading.
The fact that the company has reached the end of the first quarter
without announcing an earnings letdown has helped some investors gain
confidence that the company's first quarter will at least match
estimates, said one analyst.
The mean estimate of analysts surveyed by First Call was for earnings
of four cents a diluted share in the first quarter. Karson said most
analysts expect revenue of $60 million to $67 million. In the year-ago
period, the company earned $11.9 million, or 15 cents a diluted share,
on revenue of $85.8 million.
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All Rights Reserved.
Companies or Securities discussed in this article:
Symbol Name
NASDAQ:AFCI
NYSE:SBC SBC Communications Inc |
