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Technology Stocks : TLAB info? -- Ignore unavailable to you. Want to Upgrade?

To: Chuzzlewit who wrote (4290)	10/30/1998 11:32:00 PM
From: Jeffrey Lee	Read Replies (2) \| Respond to of 7342

FWIW to Tellab(ers) A report from Argus Independent Equity Research for Monday, November 2, 1998 follows: We are reaffirming our BUY-rating on the TLAB shares of Tellabs Inc. and raising our 12-month target price to $72 from $65. We are also boosting our EPS estimate to $1.96 from $1.92 for 1998 and to $2.33 from $2.29 for 1999. We foresee that continued robust demand for existing product lines as well as introduction of new products will drive revenue and earnings growth in 1999 and beyond. By reporting better than expected results for its third quarter, management showed that it has moved on after the disappointment of the failed merger with Ciena Corp. Excluding merger-related costs, operating earnings in 3Q jumped 50.1% on 37% higher revenue. We are convinced that despite not having Ciena in its arsenal, Tellabs has more than sufficient resources to drive future growth. We believe that the company's well-focused R&D efforts will produce equipment that addresses the networking and bandwidth needs of telecom carriers. While the flagship Titan digital cross-connect system is still sustaining robust growth, company engineers are developing the next generations of this product line that will have increased capabilities to transmit data and video. Further down the road, optical networking functions will be added to the Titan, which is a powerful network management tool. Complementing the Titan product, other product lines, such as echo cancellers and Cablespan, should increase sales even more rapidly than Titan. The echo equipment is finding its way into cellular uses to produce quieter calls. Cablespan plays very well into the need of cable operators to add two-way voice and data capacity to their traditional one-way networks. The TLAB shares were undeservedly pounded by sellers during the July-October market correction. Although the shares fell more than 60% in value during that period, sales and earnings continued on a solid upward course. The shares are trading at below historical ranges for price/sales and P/E. We believe the shares are very attractive at this point. On Friday the BUY-rated TLAB shares closed at $55, down 11/16. (DT) Argus Research will conduct a conference call at 10 a.m. EST on Friday, November 6, 1998. John Eade, Argus' Director of Research, will host the call. He will be joined by Wendy Abramowitz, Senior Vice President for Market Strategy, Richard Yamarone, Senior Economist, and Eric Melloul, Security Analyst - Telecommunications. The call-in number is (703) 925-2401. There will be a rebroadcast of the conference call at 2 p.m. EST on Friday, November 6, 1998. The call-in number for the rebroadcast will be (703) 925-2510, and the PIN number for the rebroadcast is 3240. Regards, JL