This is really a shame because, by all accounts, the company’s anti-inflammatory Anatabloc seems to work really well for people, and certainly has its adherents among investors. It’s also noteworthy that the investigations being undertaken have nothing to do with its science, so, perhaps management would do well to abide by the old political maxim not to argue with those who can buy ink by the barrel.
Equipped for growth
Telecom equipment maker Alcatel-Lucent SA (ADR) (NYSE:ALU) seems to forever be locked in turnaround mode. Ever since France’s Alcatel-Lucent SA (ADR) (NYSE:ALU) merger with U.S.-based Lucent, the company has been casting about for a way to make itself relevant in a market dominated by better-financed rivals like Cisco Systems, Inc. (NASDAQ:CSCO). The decision by wireless carriers like Verizon Communications Inc. (NYSE:VZ) and Sprint Nextel Corporation (NYSE:S) to cut back on their capital expenditures didn’t help matters, while the financial woes of Europe weighed heavily on its operations.
Yesterday, though, analysts at Deustche Bank AG (USA) (NYSE:DB) said that they think the equipment maker’s new CEO has the smarts to actually achieve that turnaround goal. Saying Alcatel-Lucent SA (ADR) (NYSE:ALU) is as ambitious as always in mapping out its abilities — though often coming up short — the analysts believe CEO Michael Coombs has proven himself adept at realizing the cost-cutting initiatives that need to be implemented.
Other analysts in recent days have started reassessing Alcatel-Lucent SA (ADR) (NYSE:ALU)’s chances, and they also like what they see. Evercore just pointed to its new software-defined network product as a serious challenge to Cisco Systems, Inc. (NASDAQ:CSCO), which is an advance that some Foolish analysts think could become “the tech trend for the next decade.” SDN builds a programmable network that virtualizes the underlying hardware by adding a layer of software between the two. By doing so, a company can link its application to its network.
It is a niche that’s just catching fire, but it seems everyone wants in, which could make it difficult for Alcatel-Lucent SA (ADR) (NYSE:ALU) to stand out. Oracle Corporation (NASDAQ:ORCL) purchased Xsigo systems for its Ethernet fabric, VMWare, Inc. (NYSE:VMW) bought up Nicira, and Cisco picked up Cariden as part of a trio of companies it scooped up last November. Juniper Networks, Inc. (NYSE:JNPR) also jumped in, purchasing Contrail two days after its IPO, and I’ve said that I think Brocade Communications Systems, Inc. (NASDAQ:BRCD) has a better-than-average chance of making a mark in SDN technology.
As a shareholder, I’m happy that analysts think that Alcatel-Lucent SA (ADR) (NYSE:ALU)’s ready to finally make good on its promise; but we’ve been down this road before, so I’ll be watching and waiting for theory to catch up with reality.
The article Whoa! What Just Happened to My Stock? originally appeared on Fool.com.
Fool contributor Rich Duprey owns shares of Oracle., Cisco Systems, and Alcatel-Lucent (ADR). The Motley Fool recommends Cisco Systems and VMware. The Motley Fool owns shares of Oracle. and VMware.
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