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Technology Stocks : Ascend Communications (ASND) -- Ignore unavailable to you. Want to Upgrade?

To: djane who wrote (50301)	7/23/1998 8:47:00 AM
From: Teddy	Respond to of 61433

Article on Ascend that appeard in this week's Information Week (p.96). Taking Stock: Ascend Attracts Interest Investors have begun to realize that there's strong demand for the company's remote access and high-speed wide area network equipment By William Schaff he last 12 months have been very exciting for Ascend Communications (Nasdaq-ASND), a leading developer and manufacturer of remote-access and high-speed WAN equipment for carriers, Internet service providers, and leading businesses. Its share price, which hit a 52-week low of $22 on Dec. 3, 1997, has risen to around $50. So, how does a company that offers niche networking and communications products--scalable carrier-class frame relay, ATM, IP, and remote-access switches and access concentrators--go from laggard to Wall Street darling so quickly? What's changed is not Ascend's fundamentals, but Wall Street's perceptions of the company. Given the stock market's short-term bias, many investors couldn't see beyond Cisco Systems' dominance in networking and its ability to take market share away from competitors. Investors expected competition in Ascend's markets to increase, and no one wanted to bet against Cisco president and CEO John Chambers. As Cisco continued to acquire new technologies, Ascend suffered some technical difficulties with its top-of-the-line Max TNT access concentrators, which handle higher call densities than remote access servers. At the same time, Wall Street was finding that network equipment purchasing trends were becoming less predictable. Slippage of large orders by carriers and ISPs made forecasting earnings more difficult. Investors were also concerned because some Ascend executives were selling stock at $30. But perceptions began to shift early this year. Companies were developing intranets, remote-access capability, home pages, and E-business systems, which boosted demand for ATM-based WANs. Ascend's new products began generating stronger-than-expected sales, which helped alleviate investors' short-term concerns. Sales of frame-relay switches are slowing, but that shortfall is more than offset by demand for new products, including Ascend's CBX500 and GX550 high-density wide area ATM switches for carriers, such as AT&T and WorldCom. Other new products include the MAX 6000 series, Ascend's high-end integrated voice/data servers, which integrate both voice and data on a single platform. The company has obviously benefited from its acquisition last year of frame-relay maker Cascade Communications Corp. Ascend's international sales continue to increase. More than 33% of the company's revenue in the second quarter came from overseas. Weakness in Asia could affect revenue growth in the second half of the year. Japan represented almost 13% of second-quarter sales, and the rest of Asia accounted for another 5%. However, slower sales in Asia might be offset by strength in Europe. Competition remains a concern. Cisco dominates networking with its broad-based product and service structure. Domestically, Lucent Technologies will be tough in the carrier market. Internationally, the major European carrier-equipment vendors, including Siemens AG and Alcatel Alsthom, are formidable. Rumors that Ascend may be the target of an acquisition have been rife this year. The convergence of voice and data networks makes the company attractive to major telecom-equipment makers such as Lucent and L.M. Ericsson. Given Lucent's high share price, I wouldn't be surprised if it made a bid by offering its own shares in exchange for Ascend's. Management has already suggested that earnings per share for 1998 and 1999 will be about $1.20 and $1.60 respectively, up nicely from $1.07 in 1997. I expect the continued strength of the company's product lines will result in higher revenue and earnings estimates by year's end. The stock is not cheap at 32 times 1999 earnings. But this a reminder to longer-term investors that they could have bought Ascend at much lower prices if they could have differentiated fact from fiction. William Schaff is chief investment officer at Bay Isle Financial Corp. in San Francisco, which manages the InformationWeek 100 Stock Index. You can reach him at bschaff@bayisle.com.

To: djane who wrote (50301)	7/23/1998 10:46:00 AM
From: The Phoenix	Read Replies (3) \| Respond to of 61433

Djane, Gary.... From LU Thread. Message 5284562 ASND apparently is off the "possible takeover list". OG

To: djane who wrote (50301)	7/23/1998 11:01:00 AM
From: Thomas M.	Respond to of 61433

wired.com ...In fact, throughout the US, Qwest workers are laying two conduits. There's an orange one containing 48 of the company's own fiber-optic cables (each one as thick as a human hair), as well as 48 for other carriers. The second conduit is black and empty. It's there for future use. "Ten years from now if there's a leapfrog in the glass, if there's another generation, we simply pull another cable or two without having to dig up the ground," says Nacchio... Tom

To: djane who wrote (50301)	7/24/1998 1:49:00 PM
From: djane	Respond to of 61433

LUCENT: Company lifted by technology boom (check out the O'Shea quote) (via NN thread - Hi Pat) THURSDAY JULY 23 1998 Telecoms By Roger Taylor in San Francisco Lucent Technologies, the world's largest maker of telephone equipment, more than doubled profits before charges in its third quarter. It was helped by international expansion and the rapid growth of integrated telephone networks capable of handling both voice calls and data. Excluding $668m in one-off charges, net income rose to $435m, compared with $213m for the same period last year. Earnings per share were 32 cents, up from 17 cents and well ahead of Wall Street forecasts of 27 cents. The better-than-expected results come after a sharp rise in Lucent's share price, which has increased more than six-fold since the company was spun out of AT&T two years ago. The business is now worth about $133bn - substantially more than its former parent. Lucent's shares rose « to 102 5/8 in early trading yesterday - against the market trend. The rise has been driven by the boom in telephone technology, including the growth of mobile phones and, more recently, the explosive growth of the internet. This is creating demand from telephone companies for data networking equipment used to manage internet traffic, e-mail, video-on-demand and the wide range of new uses to which telephone lines are being put. Lucent has also benefited from rapid international expansion. Currently, the company has only about 3 per cent of the market outside the US but is growing fast. International growth rates were twice those inside the US for most product areas. As a result, revenues grew 14 per cent to $7.2bn for the three months to June 30. The $668m in one-off charges mainly relate to Lucent's recent acquisitions of businesses that specialise in data networking equipment. They left the company with a loss of $232m for the quarter, or 17 cents a share. Lucent has identified the fast growing market for data networking equipment as central to future growth, but faces stiff opposition from the computer companies that originally developed the technology, such as Cisco Systems. Bill O'Shea, head of Lucent's data networking division, said he believed the market potential was worth up to $50bn and that this would double by 2002. Lucent has bought a string of companies over the last year, including Prominet, Livingstone Enterprises, Yurie Systems and Lannet, in order to build up its expertise in data networking, reflecting the need for telephone equipment companies to be able to offer these new technologies.

To: djane who wrote (50301)	7/24/1998 1:53:00 PM
From: djane	Respond to of 61433

Data Drives AT&T's Growth wired.com by Sean Donahue 1:50pm 23.Jul.98.PDT AT&T on Thursday said its second-quarter profit from operations rose 60 percent, better than Wall Street expected, on strong demand for high-speed data services and cost cuts. The nation's biggest phone company (T) said income from continuing operations rose to US$1.5 billion, or 91 cents a share, up from $928 million, or 57 cents, last year. Wall Street analysts had expected AT&T to earn 90 cents a share in the most recent quarter, according to First Call. Total revenue for the quarter was up slightly from a year ago to $12.9 billion, compared to $12.7 billion in the second quarter of 1997. A reduction in payroll costs from an early retirement program helped boost the money of profit the company made on each dollar of revenue. Revenue growth from wireless and business services helped AT&T offset a 3.7 percent decline in revenues from its consumer services division. That business has been hurt by increased competition in the long-distance market, the company said today. Double-digit growth in high-speed data services such as ATM and frame relay boosted AT&T's overall revenue numbers during the quarter. The shift in importance away from AT&T's traditional long-distance business highlights the changing landscape of the telecommunications industry. Data services are now the fastest growing segment of market, and account for about half of the traffic over national networks. AT&T's planned acquisition of Tele-Communications Inc. (TCOMA), announced during the second quarter, is a move to capitalize on the data trend. The company hopes to offer a bundle of communications services over TCI's cable-TV network, including high-speed Internet access and video capability, to counter collapsing prices in traditional long distance service. Questions remain, though, whether the deal will be completed. Some shareholders worry that the it will cost AT&T too much to upgrade TCI's network to support two-way communications. Since the 24 June announcement, AT&T's stock has fallen about 12 percent, causing some investors -- and even TCI chief John Malone -- to fear that shareholders will reject the deal. Investors' reaction to today's announcement was subdued. AT&T shares were up $1.31 to $59 in late afternoon Nasdaq trading.

To: djane who wrote (50301)	7/24/1998 1:56:00 PM
From: djane	Read Replies (2) \| Respond to of 61433

AOL deploys 56-kbps standard news.com By Beth Lipton Staff Writer, CNET NEWS.COM July 23, 1998, 1:05 p.m. PT America Online today said it has deployed the International Telecommunication Union standard V.90 modem protocol for 56-kbps access across its network, in an effort to open up access lines for users who increasingly are taking advantage of faster modems. Previously, the online giant supported users of both the x2 modem technology developed by 3Com and the K56flex technology developed jointly by Lucent and Rockwell, which were not compatible. Users with 56-kbps modems will be able to access AOL's network more easily now, because they no longer have to choose an access number based on a certain modem technology, the firm said. Members of the International Telecommunication Union in February agreed to a standard for 56-kbps access, dubbed V.90. The standard came about as users wanting faster access were faced with technologies that conflicted; often Internet service providers offered access with one technology or another, forcing users to choose an ISP partially based on what modem technology it supported. Along with the desire for easier access to AOL--which has had its share of network overload and consumer ire over busy signals--users increasingly are looking to access the Net at faster speeds. Faster access makes surfing easier, and also allows Net users to enjoy the ever-increasing bandwidth-intensive features on the Net such as heavy graphics and streaming audio and video. To that end, AOL and others have begun trying out speedier access options, including cable and digital subscriber lines (DSL). Those options, which offer access at much higher speeds, also can carry hefty price tags. With support for the 56-kbps standard, AOL is looking to give users somewhat faster speeds without the additional costs of cable or DSL.