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.

Technology Stocks : ADC Telecommunications -- Ignore unavailable to you. Want to Upgrade?

To: Dennis G. who wrote (373)	2/27/1998 9:16:00 PM
From: Robert Einstein	Read Replies (1) \| Respond to of 1944

Could ADC Telecommunications (ADCT:Nasdaq) be on the rebound? The supplier of phone gear warned of weaker-than-expected first-quarter earnings in late January, prompting a bruising stock fall. But Chief Financial Officer Robert Switz painted a surprisingly bullish picture at the BancAmerica Robertson Stephens Technology Conference here. Switz said the firm was poised to achieve 20% year-over-year revenue growth this quarter -- with the caveat that it would be "plus or minus" 20%. He emphasized the roughness of the figure, and expects sales to be crammed in at the end of the quarter. "We're optimistic, but cautious," Switz said, as money managers fired questions at him during a "breakout" session late Thursday. The meeting was held after the close of the trading day. Shares had risen 3/8 to end at 25 15/16 before the meeting started. The stock is trading well below its recent highs of about 50 in November. Switz's revenue prediction mirrors the estimates of Robbie Stephens analyst Timothy Savageaux. But the CFO waved several bullish flags that might surprise some investors. Among them: There are no signs that the ADC customers that are busy with mergers might jump ship to another vendor. Last quarter several merging carriers, including the long-distance duo WorldCom (WCOM:Nasdaq)-MCI (MCIC:Nasdaq), paused in their spending. That helped drain ADC's revenue and disappoint Wall Street. Now orders are being reinstated. WorldCom is "stepping up," Switz says. Its customer Teleport Communications Group (TCGI:Nasdaq) has given ADC access to a larger account -- AT&T (T:NYSE), which is combining with Teleport. Switz says that previously AT&T was "off limits," because ADC competes directly with AT&T's offspring Lucent (LU:NYSE). The restriction was effective for some time after AT&T spun off Lucent in 1996. The local carrier SBC (SBC:NYSE) might still buy fewer products, but ADC is working on that relationship. "We don't see ourselves as becoming a victim" of carrier consolidation, says Switz. Hopefully ADC shareholders are through being victimized as well.