Lucent Technologies, the poster child of 1990s excess and a classic example of “how to blow your monopoly” is proving to be a better payoff than any odds Las Vegas casinos offer. Mostly luck, and demand from the developing world has helped turn the corner, and things are getting better, like Nortel. This week’s Barron’s reports that investors who bought the stock in 2002 for around 58 cents a share, are feeling might flush these days.
bq. Lucent also has discovered the Pentagon’s fat wartime budget; it has a contract with Bechtel for telephone switches in Iraq. It also has joined the throng of contract seekers on the steps of the Department of Homeland Security.
No surprise the stock is on the move. If you bought a 1000 shares for $580, you now have about $5000 in your brokerage account. Braver souls have made even more. Last week, Lucent reported its second consecutive quarterly profit, $338 million. Last quarter the company posted a profit of $99 million. After three long years in a sea of red, things might finally be getting better for Lucent. With carriers opening their purse strings a shade, things look promising for Lucent. The problem, of course is that the company still does not products which make it competitive against more nimble players such as Alcatel, Cisco and Nortel.