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Technology Stocks : Lucent Technologies (LU) -- Ignore unavailable to you. Want to Upgrade?

To: George the Greek who wrote (5175)	12/9/1998 4:07:00 PM
From: Sawtooth	Read Replies (1) \| Respond to of 21876

IMO, George, your "suppose"isitions make sense. I'm long LU but, other than that's the way the stock acts, I have to wonder how LU's growth rate supports a 50 future p/e. I'll call support at $55; the low of the last correction. FWIW.

To: George the Greek who wrote (5175)	12/10/1998 10:55:00 AM
From: Greg Jung	Read Replies (1) \| Respond to of 21876

True, LU is overvalued and the recent PR activity has made it more so. I believe the company is on the verge of acquisitions, probably will occur in January for the big addition to complete their entre into the data network. Most likely to be merged is 3com, which is also boosting its PE and share price through analyst optimism. Such pronouncements do not come randomly from the brokerages but are followups to private meetings with company execs. Also a history of LU/3com collaborations. And the product overlap is not great - Lucent's modem chip is the only thing that comes to mind, and that is in another category than the usrx chip if the LU chip is anywhere considered successful. Edit this to recall the Livingston acquisition, which will be absorbed into the 3com manufacturing family and R&D write offs. (Product overlap and troublesome competition issues will prevent Intel from acquiring 3com). Also the 3com contract with Telephone for the voice network upgrade, and probable cable wins. Ascend would add in ok, but isn't the Yuri acquisition of the same category as the GRF? The next Question is, what premium can LU give to 3com? probably a 20% premium to post-crash (Feb '97) high or so, about $65. Paid in stock, of course, hence the unusual pre-earnings pep talk for LU. Now with 3com to report earnings soon we have MS analyst cheerleading the way there, too - trying to build higher momentum for an earnings rally that, in the case of the usual "oh, look, theres .05 /share we forgot to forecast " surprise on the paltry .20 or-whatever-it-is official estimate, can catapult the stock (3com) to where $65 will be believable. All this has to happen before Jan 31 because after that point they will need to warn if Jan sucks. Greg