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Technology Stocks : YURI ( YURI SYSTEM ) -- Ignore unavailable to you. Want to Upgrade?

To: The Phoenix who wrote (360)	2/2/1998 11:10:00 PM
From: SteveG	Read Replies (2) \| Respond to of 1181

<..How come all the YURI agreements have the OEM's (LU, BAY, AT&T, and now ERICSSON) reselling to Splitrock?..> [Good, you get me to put it together and down.] "..By the end of the year, SplitRock will be operating a nationwide ATM network capable of delivering a new generation of data, voice, video and interactive services to Internet Service Providers," said Bill Wilson, President of SplitRock. "Our long-term strategy is to position SplitRock as the premier 'carriers' carrier in this industry..." from biz.yahoo.com and "...Bay Networks this week will release two ATM access concentrators to connect corporate users to WAN services. The MX200 and the MX50 incorporate technology developed by Yurie Systems Inc. to transmit ATM data, as well as voice from a PBX, over an ATM service. Ethernet connections will be added early next year. "For the first time, we've got the entire enterprise covered with our ATM products," said Tom Slykhouse, director of switch product marketing at Bay..." from techweb.com ========= <..With half of YURI's reveunes coming from Splitrock (either directly or through one of these OEM's) how does this company move forward? Also, doesn't it seem a bit "fishy" that everything is going to this one customer...> <..AND, why did AT&T so easily walk away from an exclusive to sell the products? If the platforms were as hot as YURI says it would seem to me that AT&T would have no problem finding a home for $10M a year... Certainly not at the prices YURI charges...> <..Finally, what about all the competition coming from CSCO, NN, ASND and ADC in the ATM access space...> From BT Alex Brown on 12/8/97 (who went from a buy to a strong buy on 11/11): -We reiterate our confidence in our fourth quarter estimates of $15.1MM (+130%) in revenue generating EPS of .09 (versus .02) -We believe business with Bay Networks is ramping strongly and sell-through from the September quarter also has been solid. Initial business with Lucent is also off to a strong start in the quarter. -Since Nov 3 (97), Yurie has had to cope with a major change in its relationship with AT&T, whereby AT&T is no longer bound to minimum purchase commitments and in return, AT&T no longer holds an exclusive on federal business. We believe this is a very positive development for Yurie in that federal sales via other OEMs and Yurie's direct federal salesforce have ramped strongly and likely carry higher margins that the AT&T relationship. -On the Split Rock front, as we noted on our First Call dated November 14, we believe Split Rock continues to aggressively deploy POP sites. We estimate that approximately 40% of Split Rock traffic now is going across Yurie LDR 50s and 200s. Additionally, we believe that AT&T may provide network services and leasing to Split Rock. We view this as a major positive in that AT&T leasing should lessen the financial burden of new POP deployment on the balance sheet of Split Rock...Split Rock is likely to decline as a percentage of sales in the December quarter. ----- And Cowen has a $35-40 price target with it's current model (looking for .09). for a total of 3 strong buys on the EXISTING models. If they come in stronger, price targets will likely rise. And other major firms have been looking at picking up coverage as well. Fwiw, I'm hearing there will likely be a pretty good upside surprise in store on Thurs, with some good forward looking statements that will likely shake out some of the 2+MM shares currently short. There is a LOT of fund money looking to get back into the market. Small cap managers look for companies that consistently come in ahead of expectations. Networking is hot and ATM/QoS is a very important component - to both IP and frame relay. Yurie has two top products (that are well INTEGRATED with equipment from NN, CSCC etc.) serving both the carrier and enterprise (as well as the ATM data/voice and Ethernet) markets, that will likely continue their leadership role. The near-term weak link (in tech/networking) will be NN tomorrow, though their weakness primarily came from their TDM business. Their ATM business "..is expected to reach record levels again in the third quarter. Order intake for ATM equipment, driven principally by the MainStreetXpress 36170 Multiservices Switch, is expected to more than double the level reached a year earlier..." But in an irrational market reaction, it might well present another opportunity to buy YURI under 21 prior to Thursday's numbers/comments.