Time and Time Again: JDSU Announces Stock Split
By Cindy Christ
Just one week after its last share split took effect, fiber-
optic supplier JDS Uniphase Corp. (JDSU) said Monday its board
of directors approved another 2-for-1 stock split.
This is the third time in six months the company has split its
stock.
If approved by shareholders, the split would take effect March
10 for stockholders of record March 1. The company will ask
shareholders to increase the number of authorized shares to 3
billion from 600 million at a special meeting set for Feb. 25.
JDS Uniphase now has about 287 million shares outstanding and a
market cap of around $52 billion.
JDS Uniphase Canada Ltd., whose shares are traded on the
Toronto Stock Exchange under symbol "JDU", also said Monday it
would split its shares 2-for-1 to mirror the JDSU move.
Investors responded positively to the news, bidding JDSU shares
up $26.69, or 16.5 percent, to $188.
JSDU was among the Nasdaq's best performers last year, rising
845 percent. The company, which makes the nuts and bolts needed
to build next-generation, high-speed communications networks,
is benefiting from explosive Internet growth.
Many analysts and brokerages are predicting the company will
outperform again in 2000, as cable TV operators and broadband
network builders race to offer high-speed Web access to
customers.
In a recent CNBC interview, perennial bull and Gruntal & Co.
investment policy chairman Joe Battipaglia named JDSU as his
top stock pick for 2000.
On Monday TheStreet.com named JDSU to its "25 for 2000" list of
issues expected to lead the market this year.
Based in San Jose, Calif., JDS Uniphase designs, develops and
manufactures the components that send, amplify, split, combine,
and receive laser-generated fiber optic signals. Its customers
include Lucent Technologies (LU), Nortel Networks (NT), Alcatel
(ALA), Ciena (CIEN), Siemens (SMAWY) and Tyco International
(TYC), among others.
The company employs about 7,200 people at 15 plants and offices
in eight countries.
In a recent interview with The Internet Analyst, JDSU co
-chairman and CEO Kevin Kalkhoven said he expects the company
to continue to profit from the growing trend for leading
equipment makers to outsource some of their manufacturing
needs.
Kalkhoven also said his company is on the vanguard of an
industry that should be the "biggest single marketplace of the
next 10 years."
JDS Uniphase's recent advance has been punctuated by rising
earnings estimates from leading analysts.
On Dec. 16, 1999, Sutro & Co. Inc. analyst Natarajan
Subrahmanyan raised his 2000 and 2001 EPS estimates to $1.35
from $1.32 and to $1.91 from $1.85 to reflect the impact of a
recent acquisition.
Subrahmanyan said the company should generate earnings growth
of 45 percent over the next three years. He also reiterated his
"buy" rating and set an 18-month price target of $250 per
share.
On Dec. 16, Credit Suisse First Boston reiterated its "buy"
rating on JDSU shares, saying "We view JDSU as a core holding
for investors desiring exposure to the compelling secular
demand for optical networking infrastructure."
Of the 29 analysts who cover JDSU, 15 rate it a "strong buy,"
and 14 rate it a "moderate buy."
