JDS Uniphase (JDSU)

[DiagNNOStic]

Anyone know what going on with these guys today?

The last PR was good news not bad. The price is falling like crazy.

[AV8R]

COMING OUT OF THE DESERT

Mobile operators are increasing spending on their networks after several years of underinvestments when they were ridding their balance sheets of huge debts left over from expensive takeovers and acquiring licenses to run fast third generation (3G) networks for mobile multimedia services.

"(The) improved outlook is mainly driven by growing traffic, network expansions and continued 3G rollout. There is also an element of operators catching up on previous years' limited investments," Ericsson said.

The Telecoms must invest to give them a chance in the VOIP race. This will help the telecom equipment supplier including CSCO, JDSU, GLW etc.

[AV8R]

Press Release Source: JDS Uniphase


JDS Uniphase Appoints New Operations Executive
Monday March 15, 1:00 pm ET
New Hire Reflects Company Focus on Operational Excellence


SAN JOSE, CA--(MARKET WIRE)--Mar 15, 2004 -- JDS Uniphase (NasdaqNM:JDSU - News) and (Toronto:JDU.TO - News) today announced that it has appointed Debora Shoquist as senior vice president of operations. In this newly created position, Shoquist will spearhead the Company's efforts to lead the industry to a new level of manufacturing efficiency, operational excellence, and customer-driven execution.



Shoquist will report to Kevin Kennedy, chief executive officer (CEO) of JDS Uniphase, and will be responsible for operations for all of JDS Uniphase optical communications products, which includes over 2400 employees and operations for over 200 product lines in North America, Asia, and Europe.

"The focus at JDS Uniphase is on providing the best support in the industry to our customers, which includes flawless execution on quality and delivery requirements worldwide in a very cost-sensitive market environment," said CEO Kevin Kennedy. "Debora's proven abilities to integrate and consolidate operations, reduce costs, and efficiently manage the supply chain is precisely what we need to raise our operations to the high level we expect of ourselves."

Shoquist has over 15 years of executive experience in general management, manufacturing, and operations including plant management, engineering, information services, finance, and human resources. Before joining JDS Uniphase, Shoquist was responsible for Coherent Electro-Optics Business Units, including 8 manufacturing sites worldwide. From 1991 to 2001 Shoquist ran Quantum Corporation's global operations among her other roles with the firm. Prior to that, Shoquist gained process engineering, production, and manufacturing expertise at Hewlett Packard from 1981 to1991.

She holds both a B.S. in Electrical Engineering from Kansas State University and a B.S. in Biology from Santa Clara University.

Shoquist, who joins JDS Uniphase March 15, will be an executive officer of the Company and will be based at its corporate headquarters in San Jose, California.

[Jimmy4646]

Sorry, I mean I bought at $3.22...WOW

I was trying to lose some money there! LOL

[Jimmy4646]

Lycos, I have been in JDSU for some time but I do not remember this issue. I sold another FO company that I saw was going nowhere and bought the same amount of shares in JDSU for $3.88 ps. I had only had JDSU a few weeks when Kennedy came on board, and not knowing much about the previous CEO, I do think he is making a difference. JDSU is, as far as I can determine, the 600 pound gorilla of the FO world. They have finished restructuring and right sizing and seem to be making headway now. Their revenues are increasing and they see break even this summer.

If one looks back at the charts and see the share prices and splits this company had at one time, you would understand why it has been so long for them to dig out from under. But, long term, I see no better company out there. The latter part of 2004 and 2005 may see some good earning potentials.

[ShysterChaser]

Hello Jimmy4646:

We are very happy to see that JDSU which Jim Kramer described as a "broken" company has made a nice comeback and run.

Sorry to see that nobody with knowledge answered your inquiry on this board. Unfortunately, I do not have any special insights into predictions for JDSU and any answer I might provide would be pure conjecture.

But I do have a reason to reply to your post:
If you are an old hand with JDSU, would you be so kind to look up my Post #139 on this board at the end of November of last year and provide me with an answer or some research leads? Thank you.

[Jimmy4646]

Where will the JDSU share price be on December 31, 2004? Some say $40.00+. I would be happy to see $20.00+. Any thoughts?

[ShysterChaser]

Good morning:

I am a poster on another message board. The corporation that I am heavily invested in had a "breakthrough" technology that has really never been brought into the public view. Lucent did a "proof of concept" test which was widely criticized for its lack of real world parameters.

As I understand it, JDS Uniphase made a supreme blunder by paying $44.1 Billion for an untested, unproven, "idea" technology. And later, I am to understand, it was forced to write off this blunder.

Would someone be so kind to refresh my memory (hopefully without reopening your own old wounds) and give me the details of the steps that took JDS Uniphase down? If you could provide me with the name of the company that had the alleged miracle technology idea and the dates involved, I would appreciate those specifics, too.

Thank you.

LYCUS of YORE

[riverhigh22]

Should be some good buying opportnities in the next few days. Should be down to the $3.55 to $3.65 range.

[riverhigh22]

Cap Ex spending, as you are aware, fell off a cliff during last 2- 3 years. jds sales to telecom carriers down between 85 to 90%. Spending at the current low percentage of revenues (flat) would unlikely be made up by increased revenues. Lets say Bell South made 1,000 in 2003 and Capital Exp of 10%. If revenue went up 5% in 2004 , Cap Ex would go up $5. Let say revenues were flat but they incread Cap Exp by 5% of revenues that would result in an increase of cap ex by $50.

Althogh positive that jobs were created this month instead of a loss, the relative small number of jobs created did not impact the overall unemployment rate. This may eplain the cut back on the indexes on Friday. Caution. NT was up today with the rest of the market but collapsed later in the afternoon. Keep an eye on NT for the next couple of days. Hopefully it was just a minor correction . Fund managers were just locking in profits and not a leaked warning on the quarter ending Sept 30. Could be telling us something that may impact jds.

[learningthehardway]

But if revenues increase, as they should, the amount of capex will also increase.

Is that sufficient for appreciation?

[riverhigh22]

Jds price still has room to go down further. Recent announcement from Bell South that they intend to keep Cap EX spending "flat" from 13 to 15% of revenues for the next 3 years is not encouraging. Like SBC Bell
South seems to be focused on increasing thier dividend payouts and repurchasing stock rather than investing money back in their businees. If they lose out to the cable companies I have very little sympathyfor them. However, I think jds will drop in price once the market gets a grip on the fact that baby bells are reluctant to spend. The only way I see them pick up spending is if trhe competion gives them no choice but to spend. Not impressed with the baby bells right now.

[learningthehardway]

Some hope here.

Check out the last section, More Fiber to Homes, of this article.

http://biz.yahoo.com/ibd/030924/tech01_1.html

[learningthehardway]

A clip from an article posted in a message on Yahoo.

Holds some hope.

The inevitable result is a cut in capex. Verizon expects 2003 capital expenditures of $12 billion to $12.5 billion, a decline of $1 billion from the high end of its previous guidance of $12.5 billion to $13.5 billion.

Seidenberg says the company will move forward on its RFP for a fiber buildout next year, but with caution. “We will reallocate where we have to… We are waiting to see what the suppliers tell us… about issues of electronics and support systems that go with it." (See Fiber Surprise in FCC Rules? and Vendors Await FTTP Shortlist.)

[learningthehardway]

Not encouraging here.

http://biz.yahoo.com/djus/030924/1039000510_1.html

[learningthehardway]

I had seen that article. I thought it was quite positive. 2004 is almost here.

Verizon's news is troubling. I'm concerned their situation is not atypical.

I could see a good end of annual 2003 for JDSU (see uppandown's message), followed in January by a dismal outlook for 2004.

[learningthehardway]

Welcome, uppandown.

That's my alias on Yahoo. Should probably change to this one.

[learningthehardway]

See message from JDSU investor relations below. Any way to tell if Nortel purchases have met the requirements? Could mean large end-of-year order from Nortel.

As you know, in fiscal 2001, the Company completed the sale of its Zurich, Switzerland subsidiary to Nortel, one of the Company’s significant customers, for 66 million shares of Nortel common stock valued at $1,953 million. In addition, we may receive up to an additional $500 million in Nortel common stock to the extent Nortel purchases do not meet certain levels under new and existing programs through December 31, 2003, which is the second quarter of our 2004 fiscal year. We will report on the status of this agreement when we report on the quarter in our press release and conference call and/or in our Form 10-Q.

[uppandown]

iseewhatyousay invited me to post after posting otherboard.

Is this where serious investors come to talk about JDSU? If so, hope I can contribute, but am here to learn.

-----Re: previous post:
----------------------
Earnings /References OCT 23 Impact
by: uppandown
Long-Term Sentiment: Strong Buy 09/23/03 10:31 am
Msg: 630743 of 631113

The impact of a rather small earnings increase, over estimates, for example in the range of $.03 would cause JDSU to be in positive water. What is likelihood of that occuring? Maybe not too bad at all:

<Trend is for composite analysts to increase earnings estimate over last 90 days.> --from Yahoo Analysts Estimates.

Note: Increase in 3QTR capx increase in spending not included yet, since those numbers are not out except for IBD survey which shows small business capx spending will be up for 30% of those surveyed.

<Estimate is for 18% Sales growth in 2004> -- Yahoo Analyst Estimates.

Note: That this is based on both capx increase in 2004 and on increasing economy. However, note that deferred 1st half capx spending (USA TODAY) and Year over Year capx spending increase of 1% (Today's announcement), and increase in small Business capx (IBD Survey) haven't been included to show shift upwards in Sales growth either for 3QTR or 4QR 03.

This would tend to suggest the POSSIBILITY, not necessary the probability of JDSU reporting better than forecast numbers on 23rd of October. That would be followed by very much improved report for last quarter 03. Together these should drive stock price to a range of 7.50-8.00 USD, unless market sentiment takes higher on future valuation revisions for 04/05 which is always possible. However , the strongest positive advance signal(s) for JDSU is the following:

The SOXX is up SIGNIFICANTLY, and has corrected slightly. Alcatel and Nortel have been upgraded and are experiencing significant order activity. Both Telcom and Data houses are intensely focused on VoIP savings and increasing device load through Video on Demand and Wireless. These are not just "strong" indicators of upwards mobility for JDSU, they are the real "hot tips" that Analysts in this case are slightly behind the cure. However, nothing wrong with holding what you got. Probably still a good time to buy too. And, for shorts, god love them, hope they come in with both feet, will accelerate the upswing.

[riverhigh22]

link to report:

http://biz.yahoo.com/rf/030922/manufacturing_telecom_sp_1.html

I believe what is happening is that a lot people are saying the WORST may be over. This may explain why share prices of telecom GEAR makers are holding up. It sounds too familiar. Every time we say it can't get any WORSE it DOES. I did some techinal and fundamental analysis and did not come to the same conclusion. Both analyses showed that it is a risky time to buy in. Technical indicators are not looking good and fundamnentals for the remainder of this year are weak(I could use stronger words).

[learningthehardway]

Do you have a link to the report?

[riverhigh22]

Verizon cut back in capital spending re-inforces my view. Should see buying opportunities at lower prices.

[riverhigh22]

S&P report:

The spending slump may not bottom out until 2004, S&P said, considering that both BellSouth (NYSE:BLS - News) and SBC Communications (NYSE:SBC - News) have announced capital spending cuts for the rest of 2003.

Not happy about that news at all. Spending cuts for the rest of 2003 may result in poor guidance going forward for the jdsu in 2nd quarter. Market is hoping for positive guidance. Still think there is opportunity for adding to position on technical weakness. Just my humble opinion.

[max2442]

Silicon Valley North Feels the Chill

By Luke McCann

OTTAWA (Reuters) - Ottawa is best known its politics, but for a time in the late 1990s, its most celebrated people were among the captains of high-tech industry.

They sponsored sports and entertainment arenas, employed the best and the brightest, and brought an entrepreneurial spirit that the city had never seen.

But just as Canada's Silicon Valley of the North rose with the high-tech boom, it fell with the crash.

Most recently, some Ottawa's former high-flyers have left or been delisted.

Corel Corp., which once took on Microsoft Corp. (MSFT.O) in word processing software, was recently delisted from Nasdaq and taken over by a U.S. venture capital firm.

JDS Uniphase Corp. (JDSU.O) officially moved its headquarters to San Jose, California, earlier this month, leaving only about 600 workers behind. In the boom years, the fiber-optic components maker employed 10,000 in Canada's capital.

GSI Lumonics Inc. (LSI.TO) tried recently to move to the United States, but its shareholders were against the idea.

These evacuations or attempted departures come at a time when Nortel Networks Corp. (NT.TO)(NT.N), one of the world's biggest telecoms equipment makers and the core of Ottawa's high-tech industry, is a shadow of its former self.

"The difference from three years ago is incredible here," said Ron Zambonini, chief executive of Canada's largest software maker, Cognos Inc. (CSN.TO).

"I used to come home from a Friday from wherever I'd been and the airport was full of hopeful, young graduates all coming to interview at Nortel," he said. "The salaries were spiraling high, options were there ... but then the bubble burst."

OTTAWA'S TECH ROOTS

Ottawa's technology industry dates back to the 1970s, when ex-Nortel employees Michael Cowpland and Terry Matthews started Mitel Corp., the city's original high-flyer. Each then went on to start his own company: Matthews' Newbridge Networks Corp. and Cowpland's Corel.

By the 1990s, the once-staid city was also the capital of Canada's booming technology scene.

Multimillionaires like Matthews, Cowpland and Jozef Straus, then CEO of JDS Uniphase, strutted through town like movie stars. More than 10 percent of the area's workers were employed in tech businesses. And Air Canada had a direct flight from Ottawa to San Jose, in the Silicon Valley.

But as the tech bubble started to deflate, retrenchment and job cuts began.

Matthews has sold Newbridge to Alcatel SA (CGEP.PA) of Paris, Cowpland has been fighting insider-trading charges by Canadian securities regulators, and Straus has stepped down at JDS.

Air Canada has canceled its direct flight to San Jose.

Employment in Ottawa's tech industry has fallen to about 52,000 last month from a high of about 70,000 in March 2001. It had bottomed out at 47,000 in July 2002, according to Statistics Canada.

Not that other technology centers have escaped the bad times.

"I go to Silicon Valley a lot to talk to customers, potential investors, and, frankly, it's no different," said Patrick Brockett, chief executive of Ottawa-based Zarlink Semiconductor Inc. (ZL.TO).

But other reasons are more country-specific.

Canadian companies face higher individual and company taxes. Nor can they offer up to 20 percent to 40 percent of their stock as options to employees as incentives, as many of their U.S. competitors do.

"There are a number of very large Canadian investment institutions that scream bloody murder if it gets above 10 percent," Brockett said.

Brockett, who was born in Britain and worked in the Silicon Valley for 15 years before coming to Zarlink 2-1/2 years ago, also believes Canada's culture should be friendlier toward creating wealth.

He said he does not want to see Canada become like Britain, which he believes lacks a world-class technology base because its people become jealous of those who get rich.

Cognos' Zambonini said that access to capital might be easier in the United States. But he stressed that Canada still has a lot to offer, including an educated and motivated work force.

"If you were going to build a gold mine you'd probably go to South Africa," he said. "But when you build a high-tech company your raw materials are people, and the people are here."



09/15/03 16:30 ET

[max2442]

Connecticut officials lead class action against JDS


TORONTO, Sept 11 (Reuters) - The State Treasury and Attorney General of Connecticut are leading a class action lawsuit in the United States against fiber-optic components maker JDS Uniphase Corp <JDSU.O><JDU.TO> on behalf of thousands of shareholders.

The lawsuit, advertised in a Canadian newspaper on Wednesday, alleges that JDS insiders knew there were problems with the company, kept them a secret and personally profited by more than $3 billion, "and then let average investors lose millions when word got out and the stock collapsed."

JDS Uniphase spokeswoman Lori Goulet rejected the allegations. "(They) are without merit and we will vigorously defend the company in this matter," she said.

In the advertisement in the Ottawa Citizen newspaper, the Attorney General of Connecticut urged Canadian employees of the company to disclose what they know about the company even if they've signed confidentiality agreements.

Last month JDS consolidated its head office in San Jose, California, rather than keeping part of it in Ottawa, where it still has 580 employees, mostly in research and development.

"Some employees may have signed confidentiality agreements, but the court agreed with the Treasurer's Office and the Attorney General that employees cannot be prevented from telling what they know," the advertisement said.

JDS was one of the highest of the tech-stock high-flyers in the late 1990s. Its fiber optic equipment was in high demand and it went on an acquisition binge. Then in 2001, when the tech bubble burst, it announced a writedown of $44 billion, the second biggest writedown in corporate history.

Last month the company also announced the retirement of Jozef Straus, the company's Canadian founder. He was replaced by Kevin Kennedy.

($1=$1.37 Canadian)

09/11/03 12:57 ET

[cards16]

Surveys Gauge FTTH Future In Light Of FCC Review
Now that the FCC finally has released its long-awaited triennial review (see related story in this issue) that codifies its opinion that any new ILEC fiber builds will be free from unbundling strictures, the industry is waiting for the other shoe to fall regarding the onset of actual fiber-to-the-home, to-the-business and to-the-user services. A group headed by Verizon continues to evaluate its FTTH request for proposal circulated earlier this summer, and the Fiber-To-The-Home Council is champing at the bit, its members anticipating an avalanche of activity sometime next year.

Mike DiMauro, executive vice president/new business development for FiberCore Systems and 2003 president of the FTTH Council, believes the FCC's report "is important both to us and to the industry as a whole." Speaking with Fiber Optics News on the day the report was released, he added, "What it really means is that fiber to the home and fiber to the business are here, and we're ready to move forward. I'm sure we'll have many questions for Commissioner Kevin Martin when he keynotes our annual meeting in October." Putting on his FiberCore hat, DiMauro said, "From a company standpoint, we believe this is a step in the right direction, and it could free up the money carriers need to build out new fiber networks."

Current industry estimates put the cost of installing a dedicated fiber line to a home or office at about $2,000, down from the $4,000 it cost in 1998. And in a bold -- but probably unworkable -- plan, former FCC Chairman Reed Hundt, now a senior advisor to consultancy McKinsey & Co., reportedly is putting pen to paper to outline a national broadband buildout policy that would cost telecom users a subsidy of $20 per month until the high-speed network was built. Hundt estimates the project would cost $50 billion, but the network would be ubiquitous.

Matt Davis, broadband and FTTH analyst with The Yankee Group, now is watching Verizon and the other ILECs, waiting to see "whether they will be able to follow through with that kind of network." That concern is a common one nowadays, with optics-focused research firms and publications alike grappling with what is smoke and mirrors and what will be the real FTTH deal. ChangeWave Research (see related story in this issue) sent out some feelers of its own regarding the veracity of Verizon's FTTH plans, asking the question: "Based on your own knowledge of the company, do you think this is a serious effort that Verizon will fund aggressively or is it more a 'directional' statement to impress upon investors that the company is being aggressive?" Here's what its analysts were told:

9 percent of those surveyed believe Verizon seriously plans to build out a FTTH network
30 percent believe Verizon intends to build a FTTH network, but that its plans still are in the preliminary stages
33 percent say Verizon is using "directional statements" and press releases to impress investors
And 25 percent had no opinion on Verizon's plans.
And just to keep things on the up and up, the Information Technology Association of America (ITAA) wants the FCC to come up with a way to measure future FTTH progress. Says ITAA President Harris Miller, "Identifying FTTH reporting requirements will create transparency and help investors, telecom providers, policymakers, and consumers bring home the promise of broadband. The FCC reports should break down investment by state, metro area and zip code. A national consensus exists that new broadband investment and adoption will produce significant social and economic benefits."

Such a report would be a natural extension to existing requirements under FCC Form 477 (Local Competition and Broadband Reporting), he says, adding, "Good information about the pace of FTTH investment is necessary for application, content and other broadband service providers in our industry to make informed decisions about the available consumer market. [Because] some aspects of the triennial decision seem likely to move to the courts, FTTH investment transparency could counteract the potential impression that new investment is slowing as a result of pending litigation."

FON's Own Survey
In light of all the FTTH hubbub, FON decided to conduct its own state-of-the-technology survey, working last month with sister publication TelecomWeb. Our series of six short questions drew a lot of interest from such diverse companies as ADC, Cisco Systems, OFS, Corning, Sprint and Verizon along with such smaller entities as Teem Photonics, South Washington County Schools, General Machine Products and the Institute of Microelectronics.

In a nutshell, most of FON's survey respondents:

Believe FTTH will be deployed between 2010 and 2015,
Believe there is a viable market for such a service,
Believe existing telcos are the most logical providers of FTTH-type services, and
Believe hybrid fiber/coax will be the medium of choice.
Of the aggregate number of survey respondents during the four-week polling period, 29 percent were engineers, 21 percent were involved in top company positions and 17 percent were different flavors of managers. The rest of our respondents included analysts, consultants, bureaucrats and other fiber-related occupations.

"Without a doubt, 2004 will be the year for FTTH," says FTTH Council President DiMauro. "Electronics prices have continued to drop, there is significant RFP activity in the industry, and the FCC has now removed the single largest disincentive to FTTH investment. It is no wonder that we are experiencing an unprecedented amount of interest in our upcoming conference!"

>>Mike DiMauro, [e-mail]; Matt Davis, [e-mail]; Harris Miller, 703/284-5305<<

[aniccanow]

Really nice post over on SI curtesy of Jack Hartmann...thanks alot Jack!
http://www.siliconinvestor.com/stocktalk/msg.gsp?msgid=19276660

The Road Map to the Fiber-Optic Buildout
By Cody Willard
Special to RealMoney.com

09/05/2003 01:59 PM EDT
URL: http://www.thestreet.com/p/comment/theteleconomist/10111979.html

Fiber Optics BULLISH
The ramp-up of FTTP in 2004 and beyond could be bigger than many are predicting.
Regional Bells are deciding on protocols and are eager to start the buildout.
Optical-component suppliers look exciting.

Editor's note: This column was originally published July 23 as part of Cody Willard's Telecom Connection, a premium subscription service. We hope you enjoy this sample of The Telecom Connection. Please click here, to get more of Cody's insights on optical stocks and all of telecom.

The rumblings around the pending fiber-to-the-premises buildout continue behind the scenes, and I can hardly contain my bullishness about it. Earnings season had me fielding lots of questions about what to expect from the optical stocks this quarter. But it's important to remember that the opportunity I see here has to do with the FTTP buildout of 2004 and beyond. Although I think the ramp-up of FTTP will come sooner and be bigger than most every other analyst on the Street thinks, that means nothing for this quarter.

Revenue has already stabilized at these very low levels. Sales of Pentium processors might increase or decrease in the coming months, but sales in the optical world can't collapse much further than they already have. Stable revenue and the low enterprise values of these stocks only serve to heighten my bullish thesis. That's not to say that these stocks are bulletproof. There will be times when it's nerve-racking to own these stocks, but I'm willing to ride these longs, because the upside potential far outweighs the downside risk over the next few quarters.
Take a Right Turn in Albuquerque

Here's the route I see this buildout taking. Over the next three to four months, the regional Bell operating companies will parse through the requests for proposals (RFPs) from the equipment vendors and will begin deciding on exactly what protocols they will deploy, most likely some sort of 622 Mbps ATM PON schematic. In English, along with my thoughts on the technology, that's 622 megabits per second, which is good for a start (the average DSL speed is about 1/1,000 of that rate); asynchronous transfer mode, which is a shame, because it's not the most efficient protocol in the world; and passive optical network, which is good for operating costs going forward.

What makes me think the RBOCs are so anxious to get this buildout under way? Verizon (VZ:NYSE) is getting very anxious to get this FTTP project going, and the company expects to begin building FTTP systems in the first half of 2004.

SBC (SBC:NYSE) and EchoStar (DISH:Nasdaq) announced an agreement on July 21 to bundle satellite television services with local, long-distance and DSL services. Not surprisingly, the standard response from Wall Street was that this agreement showed that the RBOCs aren't serious about rolling out FTTP. The logic is that SBC wouldn't bother teaming with a satellite company if it was preparing to offer video services on its own. I disagree. I think SBC is getting a jump on the video service provider learning curve, and preparing its customer base for video coming over its own fiber networks. Partnering with EchoStar actually proves how serious SBC is about video, and shows that it wants to enter the foray now.
How Far? How Fast?

The market for FTTP is several orders of magnitude larger than any fiber buildout we've ever seen in this country. As a reference point, Japan, which is smaller geographically than California, is currently the largest fiber consumer in the world after rolling out limited FTTP for several years.

The size of the U.S. market and the makeup of its housing, primarily single-family dwellings rather than large apartment buildings, means the FTTP buildout will dwarf any previous demand for fiber service, including the ridiculous overbuilding of the core of the network during the late 1990s. The companies that supply the buildout will see revenue and earnings surge like never before. FTTP isn't just some flash-in-the-pan, unsustainable move, fueled by speculative capital chasing pie-in-the-sky returns. FTTP is the real deal, and it's being fueled by the conservative, rich, profitable and free-cash-flow positive Baby Bells, who will roll it out over several years.

Look at it this way: If Avanex (AVNX:Nasdaq) expands its revenue as I expect it will next year, we'll see 25% sequential growth per quarter for several years. Coming off a $25 million dollar per quarter revenue base, and estimating 15% net margins (which while aggressive, isn't ridiculous for a component business in a growth phase), Avanex would earn 14 cents per share in the eighth quarter of that growth phase. That would mean annualized earnings of 56 cents a share in the middle of 2005.

But there's more. Those earnings would jump to 35 cents a share in the 12th quarter, or $1.40 per share annualized, in the middle of 2006. Ex-ing out the $2 per share in cash on the balance sheet, that means buying shares now gets investors a strong company with a unique product line that is about to explode in growth for 2.5 times 2005 earnings and one times 2006 earnings.

Looking at FTTP from this perspective, you can see why I'm so excited about the prospects for the optical-component suppliers. Avanex and JDS Uniphase (JDSU:Nasdaq) continue to look like the most attractive component suppliers, with the right product lines and competitive positioning. Finisar (FNSR:Nasdaq) has a compelling optical-component line that could hit the sweet spot of the FTTP rollout, but it doesn't have the backing of Alcatel (ALA:NYSE ADR) and Corning (GLW:NYSE) as Avanex does; nor does the company have JDS Uniphase's dominant market share.

Corning is another company I'm continually asked about. Its balance sheet carries more risk than I want. Corning is going to be a huge beneficiary of this rollout, and maybe that will more than offset the balance sheet issues, but I just don't like the risk/reward because of how badly the company has been managed during the past five years.

If the rollout begins in the first half of 2004, the equipment vendors will begin to have some visibility into the order flow, and we'll begin to see a pickup in orders of components and building of optical access boxes even sooner than that. So while none of this activity will have much impact on this quarter's numbers or next, there could be some acceleration of business for optical component stocks by the end of this year. > http://www.thestreet.com/p/pf/comment/theteleconomist/10111979.html

Got to love the move up today. :)

[learningthehardway]

Encouraging. I would guess one of his mandates is to increase the stock price, which is fine with me.

[riverhigh22]

New CEO , Kevin Kennedy, purchased 72,500 shares yesterday at $3.45. A good sign when a CEO puts his own money in the company. Whether he is trying to make few bucks before taking over (Can't exactly buy the stock while hyping it) or just showing his confidence in the company and himself. Its all good. Being cynical myself I think he knows something that we don't.

[aniccanow]

Looking up. Nortel signs $1 bln pact with Verizon.

http://cbs.marketwatch.com/news/newsfinder/pulseone.asp?guid={2A5C6355-5F1A-487A-B5D0-502B8E9EFA34}&...

[aniccanow]

Here's and interesting article. Its very obvious where entertainment is going. Just gonna take time. Could JDS benefit?
http://cbs.marketwatch.com/news/story.asp?guid=%7B5501E279%2DCDBA%2D4779%2DAA2A%2DC5709617B481%7D&am...

Report: DVDs, CDs may go obsolete
By Jon Friedman, CBS.MarketWatch.com
Last Update: 11:40 AM ET Sept. 2, 2003

NEW YORK (CBS.MW) -- DVDs and compact discs could soon be obsolete, according to a report issued Tuesday by Forrester Research. "CDs and DVDs will go the way of the L.P.," Forrester predicts.

  CBS MARKETWATCH TOP NEWS
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Vivendi narrows it to one: GE's NBC
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Ahead of busy season, Hotels.com drops Travelocity
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File sharing is responsible for almost $700 million of the $2 billion reduction in CD sales since 1999, Forrester says, noting that movie companies face a similar sales threat.

The so-called "hard" media are in jeopardy, concludes principal analyst Josh Bernoff of the Boston-based research organization. "By 2008, revenues from CDs will be off 19 percent, while DVDs and tapes will drop 8 percent," Bernoff said.

By the end of next year, 20 million U.S. consumers will be spending $14 billion annually on broadband connections, the report says. Streaming and paid downloads will drive people "to connect to entertainment, not own it," the report says.

Gloomy trend

Forrester points out that the gloomy sales trend for CDs is already under way, as CD sales in the U.S. fell 15 percent during the past three years. Discussing what it ominously calls "the slow death of the disc," the research group says broadband, widespread storage and digital rights protection will make on-demand music and movie services more popular.

While consumers always pursue bargains and higher quality, convenience remains the key attraction.

"The idea that you have to get in your car, go to a store and buy (an item) is really out of touch," Bernoff added in an interview. "The on-demand and cable access services have all the advantages. All of the content is coming to cable."

Jarring findings

Bernoff's findings could eventually jar the entertainment industry.

Compact discs arrived in the late 1980s and were promoted by labels as a superior way for consumers to own music. The companies claimed that the quality was far better -- even though rock and roll star Neil Young, among others, eventually claimed bitterly that vinyl offered a clearer and more genuine all-round sound. Even though the labels charged more than twice as much for CDs as for vinyl products, the public snapped up CDs and vinyl labels were quickly consigned to be little more than collectors' items.

Meanwhile, sales of DVDs have been billed as the eventual lifeblood of the movie business. Analysts have seen DVDs as the logical progression as a revenue source, coming after cable television distribution and such retail stores as Blockbuster.

The report's findings will affect the media and entertainment industry's largest companies, including AOL Time Warner (AOL: news, chart, profile), Walt Disney (DIS: news, chart, profile), Viacom (VIA: news, chart, profile) and Sony (SNE: news, chart, profile).

"Movie companies are reacting aggressively and moving from talk to action," Bernoff said. "They're making it as easy as possible for you to download a movie and pay for it."

Over time, Bernoff projected, his findings will be more vivid. "There are 10 million people who now have video on demand and that number will be 20 million by the end of next year," he said.

"The big winners are going to be Internet portals and cable companies who can deliver [video] on demand," he said. "The disaster is (potentially) for retail companies," such as Blockbuster, Virgin megastores and Tower, which would suffer. "While labels will survive, I'm very doubtful for the prospects of big music retailers."

The solution is for the retailers to get the most out of the marketing appeal of their well-established brand names. "Western Union is all about maximizing its brand name, not delivering telegrams, any more," he said.

"How did we get to these crossroads?" Bernoff asked in the report. "Broadband connections, cheap and widespread storage, and ubiquitous processing power have forever liberated media from physical objects like CDs, tapes and DVDs. But the same technology forces that brought entertainment companies to the crisis point contain the promise of media's salvation -- the ability to create media services that consumers will pay for."
Jon Friedman is media editor for CBS.MarketWatch.com in New York.

[riverhigh22]

Why is jds under $5. Simple. Jds has sales of $150 /quarter with a brek even cost structure of $200 /quarter. Without visible signs of increased telecom spending or significant cuts in costs we will be in the $3 trading range.

[THOROFTHUNDER]

why is jdsu still under 5 bucks?

[riverhigh22]

It would make a lot of people's week if it reached $4.00 :)!!

However, I think that after a few weeks after labor weekend we will get a sense if there is going to be pick up on telecom spending. Carriers are currently under budget for 2003 capital expenditures. Hopefully they will spend. Need news from the Carriers that they are spending to get jdsu back to the $4.00 level. I think all will be known by mid October on how 2003 will turn out. The next October conference call from the new CEO, Kevin Kenedy, will also be preety important. Hopefully he will making the return to profitability a priority and accelerate the time table for reducing the cost structure to 170 million.

[Jimmy4646]

Can we make $4.00 by Labor Day?

That would make my week!

[Jimmy4646]

I said $3.30+ and it got there

Will it hold? I think the leadership change will help us in the long run.

[riverhigh22]

Avanex buys Vitesse FO business to strengthen their modules/subsystem making abilities. JDS recently bought Altamar Fibre Optics from Ditech for the same reason. Hopefully this type of consolidation in the industry will pay off in the eventual telecom recovery. Not only will there be less competition but it will make it very dificult for new comers to get into the game. All three remaining manafactures of size (jds, Avanex, Bookham) have moved up the food chain by making their own modules/subsytems. Easier to make individual FO components than to make a series of components and then create the modules/ subsystem. Any comments?

[Jimmy4646]

$3.30 is history I hope...

Perhaps the new direction is needed. Yes, this was a surprise to me. I don't know much about this guy but it appears we have reduced the financial burden and added new faces to boot. The new CEO used to be with CISCO. That can only be good for JDSU.

[riverhigh22]

Anouncement by the new Ceo that they are closing down the Canadian HQ. Combining CEO and COO into one postion. It's showing that jds is on track to reducing their cost structure. jds needs to jettison every bit of extra weight that isn't absolutely necessary right now. Would have prefered to have seen sales growth but cost reductions are also good :).

[riverhigh22]

$3.30+ it is :). Not quite for the reasons I had in mind. Will be interested to see what the new CEO has in mind. In a press release there was a mention of an emphasis on Customer Focus by the new CEO Keneddy. One thing we do know they did eliminate one over paid position.

[aniccanow]

Straus is gone. We'll see what that means.
http://cbs.marketwatch.com/tools/quotes/newsarticle.asp?siteid=mktw&sid=150709&guid=%7BECCF5...

[max2442]

bbuell
It has been proven that a lot of analysts are bought and paid for. I disregard any opinion from the analysts. I too think JDSU will return profitableness, but not until there is a re-entering of the market and institional buying, as well as the points River expressed. JMHO
Max

[bbuell]

Returns to profitability? How many companies like JDSU have a billion dollars in cash reserves? The analyists are morons.

[riverhigh22]

$3.30+ ... Maybe or maybe not. Who knows. I think we will be seeing these types of fluctuations in JDS, both on the up and down side, for the next while. I don't see this particlar mini rally as having any steam behind it as there is no substance. Until the sales orders start comming in from the Carriers for FO components, jdsu will be in this holding pattern. The market is in a "show me the money mood". However much I may like to see jds go up, I cán't see the share price hold up without sustainable sales growth. Just my opinion. Shares of companies will be based on individual comapny performance and not on the performance of the economy in general.

[Jimmy4646]

$3.30+ before the end of the week.

[Jimmy4646]

Next week will be a good week for JDSU

Back to $3,30+

[riverhigh22]

max2442 ... only so much emphasis can be placed on technical analysis. Fundamental Analysis and Due Diligence will always win out. As soon as telecom spending picks up and jds returns to prifatability all technical analysis indicators will go positve.

[max2442]

I hope someone has a more positive update.
TIA
Max
JDSU - JDS UNIPHASE (NASDAQ)

Date Open High Low Last Change Volume % Change
08/13/03 2.96 3.03 2.89 2.99 +0.08 24244572 +2.75 %


Composite Indicator
Trend Spotter (TM) Sell

Short Term Indicators
7 Day Average Directional Indicator Sell
10 - 8 Day Moving Average Hilo Channel Hold
20 Day Moving Average vs Price Sell
20 - 50 Day MACD Oscillator Sell
20 Day Bollinger Bands Hold

Short Term Indicators Average: 60% - Sell
20-Day Average Volume - 30356035

Medium Term Indicators
40 Day Commodity Channel Index Hold
50 Day Moving Average vs Price Sell
20 - 100 Day MACD Oscillator Sell
50 Day Parabolic Time/Price Sell

Medium Term Indicators Average: 75% - Sell
50-Day Average Volume - 28530119

Long Term Indicators
60 Day Commodity Channel Index Sell
100 Day Moving Average vs Price Sell
50 - 100 Day MACD Oscillator Buy

Long Term Indicators Average: 33% - Sell
100-Day Average Volume - 28475836

Overall Average: 64% - Sell

Price Support Pivot Point Resistance

2.99 2.83 2.97 3.11

[riverhigh22]

Once in while there is positive article. Broadband revenues will double in the next two years which is great news for the equipment makers such as JDSU.

http://biz.yahoo.com/djus/030812/1313001038_1.html

[cards16]

AUGUST 11, 2003
PREVIOUS NEWS ANALYSIS

JDSU Joins XFP Fray

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

Here's a sign that the XFP market is for real: JDS Uniphase Corp. (Nasdaq: JDSU - message board; Toronto: JDU) cares.

XFP is one of four multiservice agreements (MSAs) for 10-Gbit/s optical transceivers, the others being XENPAK, XPAK, and X2 (see PHY Chips ).

Because XFP is a serial option -- the others split 10-Gbit/s signals into four slower channels -- it's sort of a high-end play that was expected to develop after the other three. But transceiver vendors have claimed XFP is finding some early interest among OEMs (see XFP Gets the Fast Track ).

Today, JDSU plans to announce the JXP series of XFP-compliant modules. The first JXPs, using 850-nanometer Vertical Cavity Surface Emitting Lasers (VCSELs) , are available for volume shipments.

A tangled zoo of vendors is pursuing the XFP market, and a few have begun shipping full modules. A couple of random examples: Infineon Technologies AG (NYSE/Frankfurt: IFX - message board) announced samples of its 850nm and 1310nm XFP modules in March. And Ignis Optics has been sampling beta versions of 1310nm modules since February, says Ignis's director of marketing, Steve Joiner.

The 850nm modules are more suited for short distances -- less than 300 meters, typically -- whereas 1310nm devices target longer reaches. So by starting with 850nm parts, JDSU will first be targeting short-reach connections, such as linking boxes within a data center, rather than in access or metro networks.

But it's not as if the company is betting entirely on 850nm. It plans to announce its 1310nm XFP modules by the end of the year, once they're ready to ship in volume.

Some customers might have preferred seeing the 1310nm part ship first -- "It depends on your view of where XFP is going to go," says JDSU product manager Leland Day. The only certainty in planning the XFP launch was that 1550nm, suited for wide-area networking, was going to wait. "There are some people that would push a very small amount [of 1550nm XFP sales] perhaps later this year -- but that's extremely small volumes," Day says.

— Craig Matsumoto, Senior Editor, Light Reading