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Tellabs, AŞ Message Board

  • Haf48 Haf48 Dec 19, 1999 9:59 PM Flag

    Tlab going down!

    Sell signal given. Headed for 50.

    SortNewest  |  Oldest  |  Most Replied Expand all replies
    • Then go ahead and sell you asshole! you gave your hand away you fool. its just the opposite macd and stocastics heading UP>

    • where is your source for sell signal. Are you possibly a short looking to drive down share price. State your source and link and you will be believable. Till then, shutta yu moutha!

    • Tellabs' undervalued stock calls for buying,
      analyst says
      Street Smart
      Kathleen Gallagher

      Tellabs Inc., Lisle, Ill., designs, makes, markets and
      services voice, data and video transport and network
      access systems for public telephone companies,
      long-distance carriers, alternate and cellular service
      providers, cable operators, government agencies, utilities
      and business end-users.
      AnalystTheodore J. Moreau,
      managing director and telecommunications industry analyst
      at Milwaukee's Robert W. Baird & Co. Inc.
      Tellabs
      shares have not recently seen the kind of upside many of
      the company's peers are experiencing. The reason:
      concerns its major product is becoming outdated.
      But
      Moreau thinks the crisis is years away and trusts
      Tellabs will come up with enough new products and
      upgrades to keep itself competitive. Meanwhile, Tellabs'
      stock is less expensive than that of most other
      companies in the industry.
      "We think Tellabs is cheap,"
      Moreau said.
      Investors are willing to pay significant
      premiums for such telecommunications industry stocks as
      Lucent Technologies Inc. and Nortel Networks Corp.,
      which have price-to-earnings ratios of as much as 60
      times next year's earnings.

      Sure, they're bigger
      and have broader product lines, but Lucent trades at
      two times its earnings growth rate, Nortel three
      times. Tellabs is selling at just 1.3 times its earnings
      growth rate, Moreau said.
      Part of the reason Tellabs'
      bigger peers have such high multiples is because there
      are so many factors working in the telecommunications
      industry's favor.
      Phone company suppliers are profiting
      from international markets' recovery from their tumble
      late last year and the privatization and deregulation
      of phone companies around the world - and from the
      fact that less than 10% of the people living outside
      the U.S. own phones.
      They've also seen increased
      demand for equipment as a result of moves to wireless
      networks, the growth of the Internet and the growth of new
      phone companies in the United States.
      "The need for
      bandwidth is almost insatiable," Moreau said.
      Still,
      Tellabs' PE is lower than those of its peers because of
      Wall Street's concern that it won't be able to compete
      in the next generation of networking.

      • 1 Reply to jerryco1
      • Almost 60% of its revenue comes from one core
        product Tellabs developed about 10 years ago. The product
        provides high bandwidth and significant cost advantages to
        telephone companies by transferring signals back and forth
        between optical and electrical networks.

        "That's
        driven their growth over the past decade," Moreau said.
        It also helped Tellabs go from a company with $100
        million in revenue 10 years ago to one that will have
        almost $3 billion in revenue next year.

        But
        investors have held back its share price because they worry
        that as more companies put fiber optic cables in
        place, they won't need Tellabs' product to convert from
        the old to the new equipment.

        "But we think
        that's years away, and they're working on it," said
        Moreau, who thinks Tellabs can continue to turn in an
        annual earnings growth rate of 30%.

        Tellabs'
        customers include almost all the big carriers - Bell
        Atlantic, MCI Worldcom and Sprint. Moreau thinks AT&T's
        long-distance division will soon be a customer as well. "That
        alone can drive the company until new products are put
        in place," Moreau said.

        Tellabs has
        initiatives for products that will transmit data from cable
        systems to fiber networks and offer voice and data
        capabilities over cable networks. The company is also working
        on echo cancellation, which improves the signal
        quality of a wireless network, and a product that is used
        in overseas markets for managing networks under
        international standards.

        Moreau thinks Tellabs shares
        are best suited to aggressive investors looking for
        high-growth companies.

        He has his highest buy rating
        on Tellabs and would purchase these shares up to
        $72. Moreau thinks this stock could go as high as $85
        in the next 12 months. (STYL)BODY Symbol/Exchange:
        TLAB, Nasdaq Dec. 17 price: $63.25 52-week range:
        $77.25 to $31.563 Dividend yield: none Long-term debt:
        $332 million Shares outstanding: 415 million Avg.
        daily volume (12 month): 4.7 million million shares
        *Earnings per share (1999): $1.30 *Earnings per share
        (2000): $1.67 P/E ratio (1999): 48.7 P/E ratio (2000):
        37.9 *Analyst estimates for year ending Dec.
        31.


        Kathleen Gallagher's Sunday Street Smart column examines
        one stock through the eyes of a professional
        investor, revealing how market pros make investment
        decisions. Neither Gallagher nor The Journal Sentinel
        recommends specific investments or endorses the
        recommendations of those interviewed for this
        column.



        Appeared in the Milwaukee Journal Sentinel on Dec. 19,
        1999.



        --------------------------------------------------------------------------------

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