Stick one foot in the oven and the other in a bucket of ice water, and you should feel all right on average. Right?
Well, it doesn't really work that way, as JDS Uniphase
Since most investors would prefer profits over revenue growth any day, JDSU's shares are falling like a rock today, while the broader market and closest rival Agilent
Management pledged to "focus on advancing our business model across all of our business segments." In my opinion, that translates roughly to "no focus at all." I can respect the desire to meet every challenge and improve every unit, but don't call it "focus" -- because it ain't. Focus is what you do when you put more effort into one project than you do in others. And there's no need to put that spin on this report, because the company is actually in pretty good shape.
All the pessimistic expectations you can think of have already been priced into the entire networking sector. As of last night's closing bell, JDSU's shares had sunk by 55% year to date. Agilent and Cisco Systems
And JDSU has a strong balance sheet that should see it through a good stretch of bad times. Focus for real on the optical solutions to milk every possible penny out of that market while the going is good. Then invest in testing equipment once major testing customers like AT&T
But for now, in my opinion, JDSU is showing no desire to play to its strengths while the opportunity is hot. As a result, I think we're a long way away from any serious rebound in this stock.