Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : The Thread Formerly Known as No Rest For The Wicked -- Ignore unavailable to you. Want to Upgrade?

To: jimbos who wrote (48802)	6/4/1999 12:28:00 PM
From: JeffA	Read Replies (2) \| Respond to of 90042

CS - Very nice article.... The Lunchtime News Jun 04, 1999 FOOL PLATE SPECIAL An Investment Opinion by Brian Graney Is Cabletron Back? Quick quiz: What has been the top-performing networking products stock so far this year? Has it been Cisco (Nasdaq:CSCO - news) , Lucent (NYSE:LU - news) , or perhaps Nortel (NYSE:NT - news) ? Try Cabletron Systems (NYSE:CS - news) , which was up 65% as of yesterday's close and rose another $3/8 to $14 3/16 this morning on news that co-founder Craig Benson has relinquished the chairman, president, and CEO reins to Piyush Patel, formerly the company's senior vice president of worldwide engineering. Then again, maybe Cabletron's recent showing isn't so surprising after all. The company arguably had nowhere to go but up after hitting the networking industry's equivalent of the Great Wall of China in the second half of 1997. After topping out at $46 per share in May of that year, Cabletron took the express train to single-digit land in the 18 months that followed. Meanwhile, its larger networking rivals ran circles around the company, which suffered from dragging its feet in latching on to key networking technologies such as routing and gigabit ethernet. Cabletron's shares started to rally last month after Benson suggested the company may sell or spin-off some of its business units under the noble banner of unlocking shareholder value. While many anticipate a transaction involving the company's Spectrum network management software business will be unveiled sometime soon, others have speculated that Benson was planting a "For Sale" sign in the company's front yard and inviting potential acquirors in the fast-converging telecom-datacom marketplace. That last theory lost some of its bite today with the elevation of Patel, who has been handed the turnaround ball and looks poised to run with it. As head of Yago Systems (which Cabletron acquired last year), Patel helped develop Layer 3 switching technologies. That know-how has served him well at Cabletron, where he has helped roll out the company's line of SmartSwitch products -- advanced switching devices with routing capabilities. With the SmartSwitch now the company's most popular product line, Patel will look to build on that achievement by focusing his efforts on the enterprise networking and service provider markets. Whether he can waylay his SmartSwitch success into a smart turnaround for all of Cabletron remains to be seen. Building and launching a successful product is one thing; turning a $2.4 billion company around on a dime and giving the networking heavyweights of the world a run for their money in a fast-growing but tumultuous marketplace requires another managerial skill set entirely.