The seven plunders of the telecoms world

NEWS ADC Telecom, Avici Systems, Cisco Systems, Ciena, Juniper Networks, Nortel Networks and Tellabs all had their status downgraded from 'buy' to 'hold'. UBS analyst Nikos Theodosopoulos released a prediction yesterday that global telecoms capital expenditures could fall seven per cent year-over-year in 2002. According to Theodosopoulos US carriers have blown 25 per cent of their capital expenditure budgets in the first quarter, compared to 20 per cent in an ordinary year. "While we do not think there is material downside risk in the group as most of the 'bad news' is in stocks, the poor telecoms spending environment just makes it hard for us to keep 'buy' rating on these stocks," he said in a statement. UBS lowered the price goal for Nortel to $18 from $20, cut Cisco to $20 from $24, ADC to $10 from $12 and chopped Avici to $15 from $25. However, price goals for Ciena and Juniper remain at $60 and Tellabs is unchanged at $45. Shares in all seven companies slid on the news.