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Politics : Idea Of The Day -- Ignore unavailable to you. Want to Upgrade?

To: debby who wrote (33836)	9/29/2000 9:55:26 PM
From: Jill	Read Replies (2) \| Respond to of 50167

Exactly. Ike is what I come here for anyway.

To: debby who wrote (33836)	9/30/2000 1:22:07 PM
From: IQBAL LATIF	Respond to of 50167

Debby a different view point on NT and reasons of CSCO fall... CISCO AND NORTEL DOWNGRADED Telecommunications equipment firms Cisco Systems and Nortel Networks (NT, $62.50, up 3) were feeling the heat today after independent investment research firm Sanford C. Bernstein cut their rating on both companies from Market Outperform to Market Perform, citing an expected deceleration in the growth of telecom equipment spending. In a research note, they expect growth in this market to slow from 28% this year to less than 20% in 2001. In Nortel’s case, Sanford Bernstein said they expect the company’s 40%+ revenue growth to drop below 30% in 2001. It is also worth noting that about 40 different Nortel insiders and managers sold substantial blocks of shares last month. Sanford Bernstein is a well-trusted source of information because as an independent firm they are NOT subject to the bias and conflict of interest often associated with most Wall Street analysts. They have no investment banking arm and thus, their research is taken very seriously, since they have no axe to grind. Interestingly, in typical fashion Merrill Lynch defended both companies and reiterated their Buy recommendation on the two stocks. COMMENT: This was pretty big news, and although the stocks rallied amid today’s strong trading environment, we advise our readers to be cautious going forward. Both of these companies are trading at forward PE’s of over 60, and there could be some short-term downside risk here if market sentiment turns against the telecom equipment industry. However, we still like both of these companies for the long haul, and those investors with a long-term perspective shouldn’t have anything to worry about here. The network equipment industry as a whole is expected to grow at an 18% clip in 2001, and both Cisco and Nortel are well positioned to grow much faster than the industry average.A quick note: Nortel won several contracts today valued at over $500 million to expand wireless networks in both China and Taiwan. The good news helped push the shares higher despite the Sanford Bernstein downgrade.