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Technology Stocks : Efficient Networks Inc - (Nasdaq- EFNT) -- Ignore unavailable to you. Want to Upgrade?

To: Mark[ox5] who wrote (443)	9/17/2000 9:17:17 PM
From: Mark[ox5]	Respond to of 675

If Efficient Networks Delivered a Huge Quarter, Would Anyone Notice? Apparently not. Efficient’s share price decline from its closing price on 7/17, the day before Tuesday morning’s earnings announcement, continues to puzzle us given the strong upside in the quarter on the revenue, gross margin, and EPS fronts, sharp upward estimate revisions, and bullish overall outlook. The most recent issues have arisen out of Wednesday’s Westell earnings report, in which the Company reported strong growth in CPE revenue to $60 million and later indicated it had been selected as primary CPE supplier to GTE. This news has apparently sparked market share concerns, although Efficient clearly remains the market leader with $101 million in DSL CPE revenue in the quarter and significantly higher gross margins. We believe market share concerns are unwarranted given 1) the size of the market opportunity for all players; 2) the prevalence of multiple sources for CPE at all major accounts (e.g. Efficient and Westell both count Bell Atlantic and SBC as customers; 3) our belief Efficient is likely to penetrate GTE despite having no business there to date; and 4) our view that Efficient has the management team, customer and partner relationships, and strategic vision to maintain leadership in the DSL CPE market. We frankly expected the shares to move well into triple digit territory on the quarter and found the current price absolutely compelling relative to the Company’s growth rate and market opportunity. Source: wrhambrecht.com