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Technology Stocks : Covad Communications - COVD -- Ignore unavailable to you. Want to Upgrade?

To: Platter who wrote (259)	9/3/1999 7:21:00 PM
From: George Sepetjian	Respond to of 10485

2 Words-Let's Rock From Bloomberg: Technology News Fri, 03 Sep 1999, 7:04pm EDT Covad Shares Climb on Plans to Expand Interent Service to 40% of the U.S. By John Lyons Covad Shares Rise 9% on Aggressive Expansion Plans (Update1) (Adds analyst comment; updates shares.) Santa Clara, California, Sept. 3 (Bloomberg) -- Covad Communications Group Inc., which provides high-speed Internet access over phone lines, rose 9 percent after it said its network would reach 40 percent of U.S. homes and businesses. Covad rose 3 7/8 to 47 11/16 in trading of 2.0 million shares, more than its three-month daily average of 1.3 million. Earlier, shares of the Santa Clara, California-based company touched 49 5/8. Covad provides digital subscriber line services, which enables users to surf the Internet at high speeds using existing copper phone lines. Covad said late yesterday it will push into 49 markets by the end of 2000. The expansion, which has started in three markets, will give it a presence in 100 U.S. cities. ``It enables them to compete on a national level,' said Deutsche Banc Alex Brown analyst Michael G. Bowen. He upgraded his rating today to ``strong buy,' and raised the fourth-quarter 2000 price target to $90 from $70. He said Covad is some nine months ahead of its competitors in terms of installing lines and reaching new territories. Covad and other companies such as NorthPoint Communications Group Inc. sell their services on a wholesale basis to Internet service providers that repackage the service for retail customers. NorthPoint, which expects to be in at least 28 markets by year's end, rose 2 3/4 to 30. Analysts said a national presence would give Covad a significant advantage in selling its services. ``Internet service providers want to do business with a company that can solve their problems on national basis,' said Bear Stearns analyst James Henry. Most of Covad's customers are businesses, although it's also pushing into the market for residential Internet access. As part of its expansion, Covad will undertake a $45 million advertising and sales campaign to raise awareness of its brand and technology among consumers, analysts said. Covad will develop a system that allows consumers to apply for Covad services over the Internet. Those customers would be passed along to Internet service providers. ``It's a very ambitious, but strategically intelligent plan,' Henry said.