Lucent Technologies Inc. (NYSE/LU) is really a inventory that wants some major loving. This previous Wall Road darling has been discarded through the herd and is particularly now looking for some enjoy on the Street. Trading at virtually $eighty in late 1999, the stock like several Other folks during the communications sector has long been under intense force lately, experiencing lackluster profits growth and anemic gains.
Lucent has also passed through its share of lawsuits. Despite some recovery while in the communications sector, the area continues to be a difficult place to operate. The Level of competition is fierce, pricing pressures are increasing, and margins are very low.
That's the truth for that communications sector, a place That is still in limbo provided The existing climate. So what's Lucent suppose to try and do? Shareholders have lost tolerance in the flexibility of chairman and CEO Patricia F. Russo in turning about the corporation and rendering it a star once again.
Down 96% from its late 1999 substantial, the reality is traders who acquired at that level or simply lower will probably never ever Get well their losses. Lucent will never be over a money loss for those that procured at the higher and inflated prices.
The company is earning money and its forward selling price-earnings several is sensible, but specified the gradual anticipated expansion the shares upside might be restricted.
Provided the mixed outlook for the communications sector, Lucent is attempting to acquire a important hug from rival and likewise troubled France-primarily based Alcatel SA (NYSE/ALA).
Lucent soon after becoming rejected previously by Alcatel in 2001 is hoping this second attempt is achieved with hugs and kisses, anything they like to do in France.
Alcatel is reviewing the opportunity merger with Lucent, but it's while in the motorists seat as its posture is far better than that of Lucent. To put it differently, Lucent needs Alcatel much more.
But for Alcatel, a merger with Lucent could give the company much more publicity and a longtime community in The us.
The offer if consummated could be the first of many far more to come as having difficulties telecom organizations 소액결제정책 glance for ways to chop Charge and compete much more effectively.
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