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To: Softechie who wrote (1454)	7/7/2001 12:22:24 AM
From: Softechie	Read Replies (1) \| Respond to of 2155

Ciena Drops -2: Telecom Equipment Selloff Continues 06 Jul 12:00 By Johnathan Burns Of DOW JONES NEWSWIRES NEW YORK (Dow Jones)--Shares of optical systems maker Ciena Corp. (CIEN) dropped more than 10% Friday after Lehman Brothers trimmed its estimates for the company's fiscal year 2002 and amid continued weakness in the telecommunications equipment sector. In a morning note, telecommunications equipment analyst Steven Levy lowered his 2002 sales forecast for Ciena to $2.44 billion from $2.69 billion and lowered his price target on the stock to $50 from $80. He also lowered his earnings per share estimates for 2002 to $1 from $1.11. "The changes in our sales forecasts result solely from lower expectations for long-haul (fiber-optics systems) sales," Levy wrote. "The next two quarters (July and October) look solid and we remain comfortable with our projections. The long-term situation looks less clear ... we would not be surprised to see Ciena management tighten its fiscal year 2002 guidance at the end of the July quarter from a broad range of 45% to 65% currently, to 45% to 55%." Indeed, several telecommunications equipment stalwarts have already indicated sales on the long-haul portion of telecommunications networks will be down from last year, especially as North American carriers have either cut spending or been able to buy equipment at bargain prices. Ciena has been one of the few companies in the telecommunications equipment space to raise guidance for its fiscal year 2001, bucking a trend by other companies like Lucent Technologies Inc. (LU), Nortel Networks Corp. (NT) and leading component-maker JDS Uniphase Corp. (JDSU), all of whom have issued either repeated profit warnings for the year or lowered guidance drastically before the year began. The selloff in Ciena shares also comes two trading days after Marconi PLC (MONI) severely lowered sales estimates for the year ending March 31, 2002. Marconi's warning was seenas evidence that the slowdown in equipment spending by North American carriers has seeped into Europe, and any hope for a turnaround in the fourth quarter of the year seems bleak. The telecommunications sector continued a broad selloff Friday after initially taking a hit in Thursday trading following the Marconi warning. Shares of Nortel were down 6.3%, or 54 cents, to $8.06 with volume at 5.6 million compared to the daily average of 17.3 million. Component maker New Focus Inc.'s (NUFO) stock dropped almost 11% recently, or 74 cents, to $6.17 in heavy trading. Shares of systems maker ONI Systems Inc. (ONIS) dropped 8.1%, or $2.03, to $23.01 in moderate trading. Meanwhile, Ciena's stock was recently down 10%, of $3.45, to $31.09 with volume at 11.7 million compared to the daily average of 24.7 million. Earlier, the stock hit a 52-week low of $31.05. -By Johnathan Burns,Dow Jones Newswires, 201-938-2020; johnathan.burns@dowjones.com (END) DOW JONES NEWS 07-06-01 12:00 PM