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Technology Stocks : Lucent Technologies (LU) -- Ignore unavailable to you. Want to Upgrade?

To: DHB who wrote (9352)	9/1/1999 2:55:00 AM
From: MMW	Read Replies (2) \| Respond to of 21876

Hi Dan, Check this out: moneycentral.msn.com

To: DHB who wrote (9352)	9/1/1999 7:27:00 AM
From: Techplayer	Read Replies (3) \| Respond to of 21876

Dan, In response to the Jubak article posted to you by MW, I submit this. I PM's this to a friend yesterday in a private discussion. Brian Jubak has been wrong quite a bit, but I do not necessarily disagree with his overall assessment. a few points that he mentions though indicate how little he really knows about the differences between the 2 companies. The DSO issue that he beats on is directly a result of the core competencies of the businesses. CSCO is primarily enterprise based while LU is primarily carrier based. There is a significant difference in the payment terms and network deployment times between these 2 markets. additionally, he points to the smoothing of LU revenues. that is something that LU is consciously attempting to do, therefore making it logical that to accurately assess revenue growth, it should be viewed as a lumping of the 3 quarters. First LU got hit in January when the revenue stream did not hit the expected numbers in the December quarter and now he wants to discount that 800 million from the subsequent quarter. The money was generated, period. this year LU WILL grow revenues 20% and WILL grow earnings 35%. Another point that he totally misrepresents is the y2k issue. He claims that LU is blaming the smoothing of the coming December quarter on y2k. McGinn specifically stated that y2k would amount to a couple of days sales in impact and that any change in revenue/earnings expectations will be a result of an attempt to smooth these numbers over the 4 quarters. McGinn went on to say that analysts should upgrade expectations at leaf 5-7 cents over preictions in place at that time. Like Cramer, he has a vested interest and is entitled to his opinions. I believe that CSCO should grow at a faster pace than LU as it is so much smaller. What I do not believe is that CSCO will be able to keep the DSO's at currrent levels as it ventures deeper into the telco space. I also believe that CSCO is far more susceptible to margin degradation due to the increasing competition in the enterprise space.