Editor's Note: This originally ran as an alert to Action Alerts PLUS subscribers at 8:19 a.m. EST on Jan. 20. Cramer holds Lucent in his Action Alerts PLUS portfolio.
profit declines 49%," screams the headline in The New York Times. "Lucent quarterly profit fell 50%," says
The Wall Street Journal
. That, plus so-called "light" revenue, contributed to a not-great quarter, both papers declare.
Well, excuse me. Lucent (did everything I wanted. Did it do
than I wanted? No, and you could argue that "more than I wanted" is right if the stock is going to go to $5 this year. But did the company really do less than it said?
I have to tell you that everyone on the conference call yesterday, and I mean it, everyone, knew that profit would decline by half. The company repeatedly had said profit would decline by half. Repeatedly. That's not the news. The revenue "miss?" I would certainly would've liked to see another $50 million in revenue. But that wasn't worth the billion in market cap sliced off the company after the news.
Here's the rub on Lucent: It's taking share and kicking butt in wireless. Wireless is the future. In the meantime, its land-line business isn't so hot. Understood. Lucent will be the ultimate winner in wireless, which is where I want to be. So I am sticking with Lucent and will buy more when it is below my cost basis.
Wednesday's action was an overreaction. But at $3.42, the stock isn't yet at a level where it helps me to buy more. So I wait. You should, too.
P.S. One of the keys to successful investing is a smart portfolio strategy. So you might want to consider a
, where I trade my own $3 million portfolio and advise you on my every move
At the time of publication, Cramer was long Lucent.
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