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 : Ciena (CIEN) -- Ignore unavailable to you. Want to Upgrade?

To: Sam Citron who wrote (1873)	4/2/1998 1:32:00 PM
From: nghi vu	Read Replies (1) \| Respond to of 12623

reversion to the mean well, I have been saying it for 2 months. It called perfect competitive market. There is no clear tech advantage that will last more than 2 years. CIEN need to establish itself quickly, either be the cost leader or dare I say expand its product lines by acquisition and merging. Cut price like hell to hog customers and keep market share is the immediate move, look for acquisition should be next. The days of 40% margin is gone forever , 30% will be gone soon too. In today fast moving competitve force, company need to be very quick with changes. The high tech business is fill with crash and burn company that fail to understand MARKET SHARE.

To: Sam Citron who wrote (1873)	4/2/1998 1:33:00 PM
From: craig crawford	Read Replies (1) \| Respond to of 12623

<< Ciena exploited their first-to-market advantage as far as it can go. >> Agreed. It will be tougher sledding now. That's why their stock is down 25 points. I think they can do it. << Now that the race is on, LU's incumbent advantages are plain for all to see. >> Yes, they will attempt to take market share due to their sheer size just like MSFT and others do. Hopefully CIEN will continue to come out with better products to maintain their lead. << The superior solution is not necessarily the most powerful. Lucent successfully demonstrated a 256-wave system over a year ago >> I believe it was 206. Who cares? They don't even have 80 in the real world right now! << They simply want a cost-effective solution that is scalable to meet tomorrow's needs from a supplier they KNOW is going to be around >> I can appreciate your skepticism (CIEN does have risks) but this isn't the first time that you have implied that CIEN could just "disappear". If that is the case then why did people working at LU, ALA, etc. leave the comfort and safety of their jobs to defect and go to work for CIEN? << However, O'Shaughnessey shows that P/S is one of the most important indicators of future performance. >> O'Shaughnessey has his methods and I have mine. O'Shaughenessy would have kept you out of M$FT and C$CO and gotten you into COMS with his low P/S models. << The point is that such abnormally high margins tend to be a fluke, inviting competition >> Tell that to companies like MSFT, TLAB, C$CO, etc who consistently report high margins. Look at TLAB. They compete with LU and are much smaller. Their margins continue to get better and better each year. << Competition brings a reversion toward the mean. Therefore, I am always looking for sources of long-term comparative advantage. >> LU is the right kind of stock for this market. A big liquid stock that is firing on all cylinders. Wait until the economy slows down and we will see who fares better, CIEN or LU. LU will be laying off people left and right and trying to cut costs. Being big and dominating has it's advantages sometimes, but it can be a hindrance at others.