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Strategies & Market Trends : The Thread -- Ignore unavailable to you. Want to Upgrade?

To: Joe Hoek who wrote (19571)	10/25/2000 1:15:32 AM
From: KevinMark	Read Replies (1) \| Respond to of 49816

The fiber sector is the only one remaining, where the greedy Wall St. bastards haven't been able to pluck shares away. I suspect they will try anything and everything to do so. Not sure, if anyone heard Costello blabbing his mouth today on CNBC, about the Dow Jones PR concerning SDLI. Not sure who's responsible for releasing the PR on Dow Jones, but I have to question the timing, especially since the information in question, was dating back to April. I suspect a few more desperate attempts to shake out this sector, before running it up again. biz.yahoo.com Next year will be time to short this sector, not this year. KM

To: Joe Hoek who wrote (19571)	10/25/2000 5:19:27 AM
From: Mike E.	Respond to of 49816

I don't doubt it either, but do we stay at these levels? I don't think so. Now it's just a matter of picking the right one to ride back up. I'm in 100% agreement there, Joe. When people realize that these "perceived" problems are specific to NT (they have more business than they can handle - what a problem to have, eh?) there will be some greedy shorts roasting by the open fires... And I'll be standing by with my fork! <heh heh!> Hell, I'll be surprised if it lasts more than a gap down this morning, BWTFDIK!?! Oh look, the "mighty Merrill Lynch Bull" hath decried: 04:23 MERRILL URGES EQUAL WEIGHTING FOR COMMUNICATIONS EQUIPMENT AND COMPUTER HARDWARE 04:23 MERRILL SAYS UNDERWEIGHT INTERNET, INFRASTRUCTURE, SEMICONDUCTORS AND WIRELESS 04:23 MERRILL URGES OVERWEIGHT IN COMPUTER SERVICES, SOFTWARE, STORAGE AND SUPPLY CHAIN 04:23 MERRILL LYNCH SAYS EXPECTS MODEST Q4 RALLY IN TECHNOLOGY STOCKS That must mean they have more shares than they want in computer services, software and supply chain and are looking to unload. Of course, they missed the boat in internet, infrastructure, semis and wireless and need to add to their holdings. Isn't that how this works now? <g> Good luck this morning Joe! I see no need to panic. Mike

To: Joe Hoek who wrote (19571)	10/25/2000 6:24:51 AM
From: Mike E.	Respond to of 49816

06:16 [T,AWE] AT&T SAYS BOARD TO REVIEW DIVIDEND POLICY 06:16 [T,AWE] AT&T TO SPIN OFF CONSUMER, BUSINESS AND BROADBAND UNITS AS PUBLIC ENTITIES 06:16 [T,AWE] AT&T WIRELESS TO BECOME INDEPENDENT COMPANY 06:16 [T,AWE] AT&T CONFIRMS FOUR-WAY BREAKUP PLAN; RESTRUCTURING'S COMPLETION SET FOR 2002

To: Joe Hoek who wrote (19571)	10/25/2000 7:40:25 AM
From: Mike E.	Read Replies (2) \| Respond to of 49816

OCTOBER 24, 2000 Analyst Report Defends Optical The debate over declining carrier capital spending rages on in the analyst community. On Tuesday, Morgan Stanley Dean Witter released research that reassures investors that optical vendors won’t be affected. The report may come in handy on Wednesday. Following Nortel Networks Corp.'s (NYSE/Toronto: NT) earnings call on Tuesday, the optial market was rattled by news that Nortel's sequential quarterly growth in optical systems slowed, despite strong numbers all around. Most optical networking stocks were down dramatically in after-hours trading on worries that inventory had been poorly managed by Nortel, which could have implications for components vendors such as JDS Uniphase Inc. (Nasdaq: JDSU). Morgan Stanley's report comes nearly a month after analysts from Sanford C. Bernstein & Co. Inc. downgraded stocks in anticipation of reduced capex spending by service providers (see Report Downgrades Cisco and Nortel ). Specifically, Morgan Stanley picks core optical vendors, like Alcatel SA (NYSE: ALA: Paris: CGEP:PA), Ciena Corp. (Nasdaq: CIEN), Corvis Corp. (Nasdaq: CORV), Lucent Technologies Inc. (NYSE: LU), Marconi Communications PLC (London: MNI), Nortel, and Sycamore Networks Inc. (Nasdaq: SCMR). But it cautions investors to examine players in the metro access market more carefully. Why so positive on optical? There are several reasons. Despite the hype surrounding failing competitive local exchange carriers (CLECs), these carriers only account for a small portion of spending on optical equipment, says the report. Interexchange carriers (IXC) like AT&T Corp. (NYSE: T) and WorldCom Inc. (Nasdaq: WCOM) account for most of the spending. In 1999, IXCs accounted for 89 percent of spending on dense wavelength-division multiplexing (DWDM), according to research recently published by Ryan Hankin Kent Inc. (RHK). Still, a few vendors have already fallen victim to CLEC problems. For example, Ciena reported it would take a charge in its fourth fiscal quarter to cover up to $28.2 million in uncollected receivables when an order was cancelled by London-based provider, Iaxis. Sycamore also told Morgan Stanley that it would no longer be expecting revenue from Sphera Optical Networks Inc.. This could potentially affect metro transport vendor ONI Systems Inc. (Nasdaq: ONIS), which just announced a contract win with Sphera. Cyras Systems Inc. could also be affected by the financial troubles of one its customers, ICG Communications Inc. (Nasdaq/Neuer Markt: ICGX), a CLEC that has lost over 90 percent of its value in the last few months (see ICG's Sinking Ship ). Because of cheaper deployment costs and service capabilities, optical equipment generally pays for itself in a relatively short amount of time. For example, Morgan Stanley estimates that ultralong-haul gear costs anywhere from $30 to $45 million compared to the $200 to $220 million it costs for Sonet transport gear. Some metro equipment can pay for itself in as little as three months, according to the report. As stock prices of certain carriers continue to fall, it stands to reason that some spending will have to be cut. That makes sense, but Morgan Stanley predicts that carriers will reallocate money and spend more on optical equipment. “We believe that carriers have invested significantly in new fiber over the last few years, and that currently only about 16% of new fiber in North America has been lit,” says the report. “As networks evolve to packet-based architectures, we expect spending on traditional voice equipment to decline.” While the outlook is positive for the long-haul market, the success of metropolitan area equipment vendors looks a bit fuzzier, according to Morgan Stanley. For one, these smaller metropolitan area providers tend to be weaker financially. In addition, deployments of metro equipment are more sensitive to expenditure on access equipment. But on the positive side, DSL and cable modem deployments are up, which should fuel demand in the metro transport market. Also, the market for metro is so small at the moment that rapid growth shouldn’t require a significant surge in spending. -- Marguerite Reardon, senior editor, Light Reading, lightreading.com