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Technology Stocks : All About Sun Microsystems -- Ignore unavailable to you. Want to Upgrade?

To: larry pollock who wrote (59221)	3/5/2004 5:25:49 PM
From: larry pollock	Respond to of 64865

Management "has been slow to adapt to market changes since the downturn," when the tech bubble burst in the spring of 2000. Associated Press S&P Downgrades Sun Microsystems to Junk Friday March 5, 5:00 pm ET S&P Downgrades Sun Microsystems Credit Rating to Junk, Affecting $1.3B of Public Debt NEW YORK (AP) -- Standard & Poor's cut its credit rating on Sun Microsystems Inc. two notches to double-B-plus, the top speculative, or junk, rating, affecting about $1.3 billion of public debt. The computer company hasn't "had investment-grade predictability and profitability in two-plus years," said S&P analyst Martha Toll-Reed. Management "has been slow to adapt to market changes since the downturn," when the tech bubble burst in the spring of 2000. ADVERTISEMENT May Petry, a spokeswoman at Santa Clara, Calif.-based Sun Micro, said the company has a "strong financial foundation of $5.16 billion in cash and marketable securities, which is over three times our outstanding debt." She said the company's cash position, coupled with its products and customers, makes Sun Micro "well-positioned to achieve its goals." Toll-Reed didn't dispute its financial profile, but said the rating is more a reflection of their business risk. "The cash gives them flexibility without question," she said. "They have good technology and a good product line-up. But they have a relatively narrow revenue base, and market growth is in segments that are not to their historical strength," she said. S&P's outlook on Sun's rating is stable. Fitch Ratings last month downgraded Sun Micro's senior unsecured debt one notch to triple-B-minus, its lowest investment grade rating. Last September, Moody's Investors Service dropped the company to Baa3, its lowest investment-grade rating, with a negative outlook -- indicating a downgrade is likely within one and a half to two years. Sun Micro "is a work in progress with a lot of new product initiatives, and the question is how customers will respond," said Moody's senior analyst Paul Hsi. "Can Sun regain market share?" Shares of Sun Micro finished Friday at $4.80, down 36 cents, or 7 percent, on heavy volume on the Nasdaq Stock Market.