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

To: Walter Morton who wrote (7998)	5/27/1999 8:08:00 PM
From: KYA27	Read Replies (3) \| Respond to of 21876

Why is LU holding steady amid downturn? Cisco, Lucent Offer Shelter From Net-Sector Storm By Kevin Petrie Yahoo Staff Reporter SAN FRANCISCO -- Providing safe havens in the Internet maelstrom, shares of Cisco (Nasdaq:CSCO - news) and Lucent (NYSE:LU - news) have been largely unruffled by the exodus of capital from high-profile Net plays in recent weeks. Internet stocks have taken quite a clubbing since the Nasdaq Composite's high-water mark on April 26. eBay (Nasdaq:EBAY - news) is still down 17% from its high this year, and Amazon.com (Nasdaq:AMZN - news) is off 42%. The same goes for Internet bellwethers Yahoo! (Nasdaq:YHOO - news) , down 27%, and America Online (NYSE:AOL - news) , down 26%. By contrast, the two communications-equipment stocks corrected mildly before joining Wednesday's recovery. Cisco, the leading builder of computer-network equipment, is down 7% since April 26. Lucent, the largest supplier of gear for telephone networks, is off 10% in the past month. The Nasdaq Comp has fallen 9%. Even after the market's overall bounce Wednesday, money managers expect this division in stock behavior to continue. The correction was "vicious, but not surprising," says Curt Rohrman, portfolio manager of the USAA Science and Technology fund, which holds both Cisco and Lucent. "You're going to have big swings [in Internet stocks], as people go manic depressive on them." One reason for the stability is that even-keeled institutional investors hold a larger stake in these stocks: They own 48% of Lucent shares and 64% of Cisco shares, according to Market Guide. By comparison, institutional ownership of Infoseek (Nasdaq:SEEK - news) , eBay and priceline.com (Nasdaq:PCLN - news) is 20%, 11% and 0.2%, respectively. These Net stocks have been dominated by trading among individual investors. "There are real buyers with real money to buy Lucent and Cisco. I'm not sure you can say that about these second- or third-level Internet companies," says David Brady, portfolio manager with Stein Roe Mutual Funds. And unlike the e-commerce and portal plays jostling for control of their markets, Cisco and Lucent shine as clear leaders in an industry that has already seen its share of consolidation. Next month, Lucent expects to close its acquisition of Ascend (Nasdaq:ASND - news) , currently the No. 2 computer networker.