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Technology Stocks : Alcatel (ALA) and France -- Ignore unavailable to you. Want to Upgrade?

To: zbyslaw owczarczyk who wrote (1713)	5/5/2000 8:10:00 AM
From: Paul Lee	Read Replies (1) \| Respond to of 3891

upgrades all over the place Alcatel rockets to new highs amid slew of upgrades By Sophie Walker PARIS, May 5 (Reuters) - Shares in French telecom equipment firm Alcatel rocketed to record highs on Friday, propelled by a slew of brokers' upgrades after it unveiled a surge in profits and an aggressive growth strategy. At 1140 GMT the stock was up 7.7 percent at 296.7 euros after leapfrogging previous highs to hit a peak of 299.7 euros. Turnover swelled to 689 million euros, on top of the one billion euro of shares which changed hands on Thursday. At this level, Alcatel had a market capitalisation of 61.93 billion euros ($55.74 billion), putting it fifth in the CAC-40 index of blue-chip shares .FCHI), a fraction behind semiconductor maker STMicroelectronics. ``People are desperately looking for ideas in this market, and Alcatel has become the latest craze,'' said one trader. ``Of course it's because their figures were good and because they are spinning off their cable business, and people are now realising how undervalued it was compared to other telecoms shares,'' he said. Alcatel sank to a year low of 195.5 euros on April 5, hit by poor sentiment on the sector as a whole, but also because the market intially reacted negatively to its $7 billion purchase of Canada's Newbridge Networks Corp. On Thursday, the stock gained almost 10 percent after the company said it was targeting full-year operating profit of nearly two billion euros and posted first quarter net income of 258 million euros against an 18 million euro loss a year earlier. The firm also doubled forecasts for growth in the telecoms sector and said it would spin off most of its cable activities into a separate bourse listing by the end of the year. NEW PRICE TARGETS IN 300-400 EURO RANGE CCF Securities was most bullish in its analysis of Alcatel, lifting its 12-month price target to 400 euros from 350 and keeping the stock on its recommended list. Lehman Brothers upped its rating to ``buy'' from ``outperform'' and raised its price target for the second consecutive day, to 360 euros from 320 euros. Market sources said BNP Equities had raised its price target to 350 euros from 300 and had set a new full-year net profit target of 1.4 billion euros, up from 1.16 billion. BNP raised its 2001 net profit prediction to 1.8 billion from 1.45 billion and its 2002 forecast to 2.3 billion from 1.78 billion, traders said. KBC Securities raised Alcatel to ``buy'' from ``add'' and its price target to 330 euros from 290. It also raised its EPS forecast to 6.6 euros from 5.6 euros for 2000 and to 8.1 euros from 6.6 euros for 2001. The ETC brokerage raised its target for Alcatel to 365 euros while the Wargny brokerage reiterated a ``strong buy'' rating with a target of 300 euros. ``Alcatel has given itself the means to become a pure telecom player,'' Christophe Quarante, analyst at KBC Securities, said in a report. The planned acquisition of Newbridge Networks Corp, a joint venture with Japan's Fujitsu, and the spinoff of the cable business put Alcatel in a favourable position in the mobile internet race, he said.