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Technology Stocks : Newbridge Networks -- Ignore unavailable to you. Want to Upgrade?

To: Rob Riordan who wrote (12233)	7/13/1999 5:25:00 PM
From: Rob Riordan	Read Replies (3) \| Respond to of 18016

Newbridge Networks Stock Dives On Earnings Jitters By Sarah Edmonds TORONTO (Reuters) - Newbridge Networks Corp. (NYSE:NN - news) shares tumbled Tuesday, singed by worries about the networking company's earnings that were apparently ignited by misinterpretations of an analyst's comments. The analyst, New York-based Paul Silverstein at BancBoston Robertson Stephens, said the sell-off was the result of a ''Chinese Whispers'' corruption of a comment he made to his sales force. ''We are not cutting our numbers. We are not cutting our rating and I am not saying that they are not going to make the numbers,'' Silverstein said. ''All I said was that against the backdrop of a strong start to the quarter, that I believe that demand weakened in July.'' The frenzied street attributed a vast range of comments to Silverstein, who spent the day fielding calls. One analyst cited rumors that Silverstein had ruled out Newbridge as a takeover prospect, and another talked about the company -- which disappointed analysts in five of the past eight quarters -- issuing yet another earnings warning ahead of its fiscal first quarter. Trading of Newbridge stock was halted briefly in Toronto and New York just after 1400 EDT/1800 GMT because of a sell imbalance but trading resumed within minutes. The stock plummeted before the brief halt in the early afternoon, dropping as low as C$36.55 on the Toronto Stock Exchange before recovering to close down C$3.65, or 8.5 percent, at C$39.50 in trade of 1.96 million shares. In New York, Newbridge dropped as low as $25.50 before clawing back part way to end down $2.75 at $26.50. Newbridge issued a statement saying it was unaware of any corporate developments or external factors that would account for the plunge in its share price. ''There are rumors of an earnings shortfall,'' said one equity trader. ''I think they've done it so many times that people are just fed up with it.'' Silverstein, who rates the stock a buy, said he believes in Newbridge as a long-term investment. He said Newbridge's cornerstone product -- asynchronous transfer mode technology that allows voice, video and data to be crammed down a telephone line at high speed -- is finally coming into its own. Newbridge in June posted a fourth-quarter profit ending May 2 of 12 U.S. cents per share, excluding charges and gains, meeting expectations revised after a warning issued during May. Silverstein expects the company to earn 15 U.S. cents in its first quarter. ($1-$1.48 Canadian)