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

To: Doug who wrote (14024)	10/28/1999 6:48:00 AM
From: Glenn McDougall	Read Replies (3) \| Respond to of 18016

Rumour mill grinds Newbridge stock By KEVIN BELL, Money Editor, Ottawa Sun NEWBRIDGE Networks investors were spooked yesterday by rumours on Wall St. that the Kanata firm will miss profit projections for the current quarter. The rumours caused the stock price's month-long tailspin to pick up speed, losing $1.55 or 5.3% yesterday to close at $27.45 on the Toronto Stock Exchange. In the last month, the stock has plunged from around $39 -- a loss of 30%. The rumours, which quickly spread to Bay St. and Internet message boards, shook jittery investors' faith in the company, which over the last two years has developed a history of disappointing the market with weak profits and repeated warnings about missed targets. "There are still some fundamental risks about the company, so when I hear rumours I tend to think they're true," said Paul Sagawa, an analyst with Bernstein & Co. According to the rumours, analyst Jim Kedersha of the New York securities firm SG Cowen & Co. issued a report indicating Newbridge may not hit its targets for this quarter, which ends Friday. Kedersha did not return several phone calls. Rob MacLellan, an analyst with CT Securities, said the buzz confirmed his feeling that something may be amiss within Newbridge. "We were telling people as early as Friday that this quarter is far from in the bag," he said. Analysts say the investing community is bracing for a possible earnings warning, which could come next week, MacLellan said. "This stock has for the most part been abandoned." Since Kedersha is a well-respected analyst, the financial community is paying strong attention to the reports, he said. Newbridge's recent silence is also wearing investors down. "They haven't said everything is okay. That's added to the nervousness." Newbridge is in its quiet period that precedes the reporting of financial results, which are expected Nov. 18. The latest earnings worries are coming on top of doubts about Newbridge's ability to compete against juggernauts like Cisco Systems and Nortel Networks. "But I think the clock is ticking on earnings now," said Patrick Houghton, an analyst with Sutro & Co. "People will breathe a sigh of relief if they get past Nov. 9 without pre-announcing."