Three Picks In Telecommunications Services
07.26.05, 3:41 PM ET
SG Cowen said second-quarter results in the telecommunications sector point to continuing improvements in the hosting/co-location market, as well as to the slowing of price declines in the bandwidth market.
The research firm said its top picks in the sector are Equinix (nasdaq: EQIX - news - people ), Terremark Worldwide (amex: TWW - news - people ) and Savvis Communications (nasdaq: SVVS - news - people ). In addition, SG Cowen said that both Internap Network Services (amex: IIP - news - people ) and Arbinet-thexchange (nasdaq: ARBX - news - people ) are showing more clarity and more promising earnings outlooks. For the second quarter, Savvis showed rapid growth and improving prices in hosting, particularly the co-location segment. "These trends should also benefit Equinix, Terremark, and Internap," SG Cowen said.
The research firm said IP bandwidth pricing declines appear to be slowing in the wake of the SBC Communications (nyse: SBC - news - people ) and AT&T deal, as well as the Verizon Communications (nyse: VZ - news - people ) and MCI (nasdaq: MCIP - news - people ) deals. "This benefits Savvis and Internap," the research firm said.
