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Technology Stocks : Nortel Networks (NT) -- Ignore unavailable to you. Want to Upgrade?

To: Bill who wrote (4419)	1/26/2000 11:03:00 AM
From: SJS	Read Replies (1) \| Respond to of 14638

Third upgrade, CSFB chimes in....: ________________ Nortel Networks (NT-$108 7/8-Cap 148B-Strong Buy) Posts Strong Q4:99 Results; Impressive Book-to-Bill Points to Excellent Visibility Entering 2000 2000E: $1.30, 2001E: $1.60 (US GAAP) · Excluding non-recurring items, NT reported Q4:99 EPS of $0.43, in line with our est. and above the consensus est. of $0.41; Under CDN GAAP, NT posted EPS of $0.48, above our $0.47 est. and the consensus est. of $0.46; Increasing 2000 EPS to $1.30 from $1.25 and 2001 EPS to $1.60 from $1.55 (US GAAP). · Q4:99 highlights include a book-to-bill of 1.34 resulting in outstanding visibility entering 2000; Bookings diversified among optical, wireless, and access systems; Timing of orders and mfg. constraints (in optical systems) restrained sales at $6.6 billion (in line with our estimate and above consensus); Wireless rebounded posting 33% year over year growth. · Revised estimates reflect an increase in top-line growth rates to 21% (vs. 20%) for 2000 and 18% (vs. 17%) for 2001 and modest op. margin advance; Potential exists for upside surprises to our 2000 forecast. · Balance sheet solid; Accounts receivable DSOs decreased sequentially to 113 days from 115 days; NT generated $600 million in cash from operations; Inventory levels increased to support 2000 manufacturing build. · View NT shares as a core holding; 9 month target $125; Reiterate STRONG BUY. · Separately, Nortel Networks announced a 2-for-1 stock split.