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Wednesday, August 09, 2006

JDS Uniphase Basks In The Glow

Stocks: (JDSU)(CSCO)

JDSU is up over 5% today. The search for reasons only turns up the long tails created by Cisco's good numbers. Cisco is up 14%.

But, does it make any sense? Cisco's business of communications equipment and routers bears some rough relationship to JSDU's test and measurement solutions and its optical products. And, JDSU's CEO is from Cisco.

But, the results that the two companies have produced over the last few quarters could not be more different. JDSU's revenue was flat over the quarters ending March 06 and December 05 at about $313 million. The company had operating loses of $39 million and $52 million respectively in the same two quarters.

Cisco's revenue for the quarter just announced was $7.98 billion, up 21% from a year ago. Without acquisitions revenue grew about 12%.

It remains to be seen if JDSU can ride the same train as Cisco, but a 5% jump in the share price is probably not justified.

Douglas A. McIntyre can be reached at He does not own securities in companies that he writes about.

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