Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Market Gems:Stocks w/Strong Earnings and High Tech. Rank -- Ignore unavailable to you. Want to Upgrade?

To: LastShadow who wrote (4690)	1/12/1998 1:59:00 PM
From: Jenna	Respond to of 120523

WorldCom, Baby Bells to ring up strong Q4-analysts By Jessica Hall NEW YORK, Jan 12 (Reuters) - Fourth quarter results for telecommunications companies will follow a familiar pattern as the regional Bells outperform the long distance carriers and integrated providers such as WorldCom Inc lead the industry, analysts said. "WorldCom will lead the pack in term of good volume growth, good revenue growth and the comparable growth in earnings," said Raghu Ram, a telecommunications analyst with Wheat First Butcher Singer. "WorldCom is an end-to-end company. They're enjoying the benefits of being able to sell Internet, voice, and data on their own network instead of having to resell someone else's services," Ram said. WorldCom and LCI International Inc , which also offers voice and data services, should see 30-35 percent growth in "minutes of use," outpacing others in the industry which may see only single-digit volume gains, Ram said. While the the fourth quarter is traditionally strong due to heavy calling during the holiday season, long distance carriers are facing increasing competition that is eroding revenue in some markets, analysts said. "There's tremendous competition in the long distance market even without the (Baby) Bells coming in yet. The business is very healthy but the consumer side is still very competitive. The smaller LDs and the resellers are being very aggressive," said Bette Ann Colombo, a telecommunications analyst with Bear Stearns. AT&T Corp will see solid growth in its core earnings as it begins to benefit from a cost-cutting program announced last year, it but will see greater dilution from new ventures such as local and Internet service, several analysts said. AT&T may also see some weakening in long distance revenue growth on the consumer side due to a cutback in marketing, but the business side appears to be slightly stronger. While AT&T trimmed marketing expenses, rival MCI Communications Corp bolstered spending and increased long distance revenue. "MCI's long distance revenue growth improved due to marketing initiatives, but those same efforts take a toll on profitability. There will be some deterioration in long distance profitability, year-over-year and sequentially." Colombo said. MCI will continue to see earnings dilution from spending on emerging businesses such as local telephone service, but those losses may be less than expected, analysts said. Sprint Corp will lead the long distance sector with volume growth of 12-13 percent, but will see a decline in earnings due to ongoing expenses for its Global One alliance and its wireless ventures, Colombo said. For the Baby Bells, the earnings outlook appears stronger. Most companies are expected to exceed last year's fourth quarter results due to internal cost cutting and strong line growth, driven by demand for fax machines and Internet access, analysts said. SBC Communications Inc should lead the group with year-over-year EPS growth of about 13 percent, as it benefits from savings from its merger with Pacific Telesis, Merrill Lynch analyst Daniel Reingold said in a research report. Both BellSouth Corp and Ameritech Corp are expected to post operating earnings growth of about 10 percent, but Bell Atlantic will see only single-digit growth due to increased costs for its wireless iniatives, said Linda Meltzer, an analyst with UBS Securities, in a research report. U S West's earnings will drop due to heavy spending on initiatitives in personal communications services (PCS). GTE Corp will also see a decline of about 8.5 percent due to investments in new initiatives such as data, Reingold said Company (all in dlrs) Q4 Yr Ago Results Date Ameritech..................1.10.....1.00....Jan 13 AT&T Corp .................0.71.....0.76....week of Jan 26 Bell Atlantic..............1.26.....1.17....Jan 21 BellSouth..................0.71.....0.64....Jan 23 GTE Corp...................0.74.....0.82....Jan 27 MCI Communications Corp... 0.12.....0.44....Jan 23 SBC Communications.........0.98.....0.82....Jan 28 Sprint Corp................0.38.....0.65....Feb 3 WorldCom.................. 0.15.....0.29....Feb 19 US West Comms..............0.59.....0.63....Feb 12 Estimates from First Call. Reporting dates from analysts (( New York newsdesk 212-859-1610 ))