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Strategies & Market Trends : Technical analysis for shorts & longs -- Ignore unavailable to you. Want to Upgrade?

To: Logain Ablar who wrote (36367)	3/6/2002 3:41:18 PM
From: Johnny Canuck	Respond to of 70131

MCDT Impact on Storage Sector : -- Before Open -- Goldman Sachs's Laura Conigliaro believes much of this preannouncement comes from MCDT's specific product and customer set and not the (admittedly weak) IT environment; would be buyers of BRCD, EMLX, and QLGC on weakness. Bear Stearns spoke with BRCD and QLGC last night regarding their qtr; BRCD reiterated that qtr is on track for modest seq. growth in earnings and revenues; QLGC also confirmed that business trends remain healthy although the co. sells in a different segment than MCDT. Thomas Weisel stresses MCDT's shortfall should not impact VRTS, QLGC, and EMLX; would buy VRTS (aggressively on dips) and QLGC (if shares were to pull back into the $38-40 price range); remains comfortable that EMLX will achieve their qtrly est of $65.8 mln in revenue and $0.13 EPS. Salomon Smith Barney on UTStarcom (UTSI) 23.33 -1.37: --Intraday-- This morning there was an article quoting Wu Jichuan (head of MII) that China Tel will not be approved for new licenses to provide its PAS service. Although China Tel will be allowed to continue to build out its PAS networks in regions it has a license (about 22 provinces), Salomon Smith Barney feels inability to continue to expand its reach of PAS with new licenses lowers longer-term growth profile of PAS industry in China from an equipment perspective. Near-term EPS visibility remains high for UTSI, firm's ests for Y02 remain unchanged. However, firm believes this news underscores firm's biggest concern with UTSI - unpredictability & credibility of news-flow from China; believes stock's multiple is likely to receive a discount to 2-3 year EPS growth rate (35%) given increased uncertainty surrounding viability and predictability of UTSI's long-term earnings profile. Firm lowers price target to $25 from $38. McDATA (MCDT) 11.84 -4.09: -- Before Open -- MCDT warned for their Mar qtr yesterday; revenue is now projected to be in the $73-78 mln range with an EPS loss of $0.02-0.04 vs. previous guidance of $85-95 mln and EPS of break-even to a profit of $0.02. Analysts are cautiously optimistic on shares. Bank of America lowers their price target to $15 but maintains their Buy rating on the co's strong product cycle with FICON, 2 gigabit in the June qtr, and a new 140-port core director in the Sept quarter. Robertson Stephens maintains their Mkt Perform rating on their cautious near-term outlook on the storage mkt; adds that MCDT is positioned for long-term growth driven by the shift to networked storage. ABN AMRO remains concerned about competition from BRCD; believes BRCD may be gaining market share from MCDT with its early lead in the 2Gb switch mkt.