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

To: James A. Venooker who wrote (58027)	12/9/1998 12:31:00 AM
From: Bindusagar Reddy	Read Replies (2) \| Respond to of 61433

CREDIT SUISSE FIRST BOSTON CORPORATION Equity Research-Americas Industry: Telecom Equipment - Wireline 12/04/1998 STRONG BUY Ascend Communications (ASND) Key Points * Management reiterated strategy of providing best-in-class packet-switching and remote access products to post additional market share gains. * Q4:98 tracking to plan; Potential for modest upside revenue and earnings surprise; Q1:99 visibility good based upon large number of new core switch contract wins and opportunities in voice over IP. * Divestiture of non-core Stratus assets on track for close of 1998; Management believes at least two of the three assets will be sold by year-end and the third will be completed by early January. * Visibility to Stratus synergy opportunities improving; Boosting 1999 EPS estimates to $1.70 from $1.65; Increasing price target to $65 from $60. * Software suite for NTT that was delayed in Q3:98 has been delivered, as a result management expects core switch sales to Japan to be up sequentially in Q4:98. * ASND is currently in discussions with several financial institutions to establish relationships that will enable the company to minimize its role in providing vendor financing during 1999; Rate shares STRONG BUY. Price Target Mkt.Value 52-Week 12/03/981 (12 Mo.) Div. Yield (MM) Price Range $57.56 $65 NA None $12,001.3 $22.00-59.63 Annual Prev. Abs. Rel. EBITDA/ EPS EPS P/E P/E Share 12/99E 1.70 1.65 33.9X 119% 12/98E 1.18 48.8 154% 12/97A 1.06 54.3 167% March June Septeber Dec. FY End 1999E $0.36 $0.40 $0.45 $0.49 Dec. 31 1998E 0.26 0.29 0.32 0.31 1997A 0.31 0.31 0.20 0.24 ROIC NA Total Debt (9/98) $0 Book Value/Share (9/98) $6.34 WACC NA Debt/Total Capital (9/98) 0% Common Shares (mil) 208.5 EP Trend2 NA Est. 3-Yr. EPS Growth 30% Est. 3-Yr. Div. Growth NA 1On 12/03/98 DJIA closed at 8879.68 and S&P Industrials at 1373.58. 2Economic profit trend. Ascend Communications is a leading provider of technology and equipment solutions for telecommunications carriers, Internet service providers (ISPs), and corporate customers worldwide. Discussion Companies mentioned: Ascend Communications (ASND-Strong Buy-$47 5/8) Stocks priced as of December 3, 1998. * Covered by another CSFBC analyst. CREDIT SUISSE FIRST BOSTON CORPORATION CREDIT SUISSE FIRST BOSTON CORPORATION CREDIT SUISSE FIRST BOSTON CORPORATION CREDIT SUISSE FIRST BOSTON CORPORATION This memorandum is for informative purposes only. Under no circumstances is it to be used or considered as an offer to sell, or a solicitation of any offer to buy, any security. While the information contained herein has been obtained from sources believed to be reliable, we do not represent that it is accurate or complete and it should not be relied upon as such. We may from time to time have long or short positions in any buy and sell securities referred to herein. This firm may from time to time perform investment banking or other services for, or solicit investment banking or other business from, any company mentioned in this report. Copyright 1998, CREDIT SUISSE FIRST BOSTON CORPORATION = = Ascend Communcations = =ASND:Strong Buy