To: MD Bryant who wrote (6887 ) 10/7/1998 12:54:00 AM From: pat mudge Respond to
Fetid dingos kidneys, indeed!Meantime, both companies will have to weather tough economic problems in some key sales areas -- Asia, Russia and Latin America -- for at least a year, analysts said. ''You also have to throw into this a decelerating market for telecom equipment in general,'' Theodosopoulos said. ''You throw that (in) as a back-drop to this environment, it's going to be a challenging year here.'' Telecommunications giants including Nortel and French rival Alcatel (NYSE:ALA - news) have lowered revenue and earnings forecasts recently and analysts have downgraded Nortel, Newbridge and others telecom equipment companies in the last two weeks. Dramatic changes in communication technology are feeding demand for more and more comprehensive services, Mr. McGinn said, adding that there is an explosion of demand for more communication-network capacity, cost-effectiveness and reliability. That means companies that can meet those needs will see no shortage of customers. Duncan Stewart, portfolio manager at Tera Capital, said the damage is temporary. Neither company is out of the woods yet, said Rob MacLellan, analyst at Kearns Capital. ''The worst is not over for Newbridge. I wouldn't say the worst is over for Nortel, but a vast majority of what you call the worst is over. Now it's what you call damage control time.'' Newbridge is concentrating on products that use asynchronous transfer mode (ATM) technology, which had been touted as hot stuff. It has generally ignored voice over Internet Protocol (IP), which has been gaining in popularity as a new way to make telephone calls. Some analysts said investors are holding Newbridge in hopes that it will be bought out, but this is unlikely, MacLellan said.
