"Tellabs (TLAB) is either toast, or a great idea right here," said one fund manager walking into a Telllabs presentation at the Chase H&Q Technology Conference today. So it goes with tech stocks right now, with the metaphorical bases loaded, and investors wondering if the batter can hit -- or even get hit by a pitch.

Given that scenario (and stretching the limits of that metaphor), Tellabs fans were anxious for any suggestion the telecommunications-equipment manufacturer is still in the game.

They certainly had reason to worry. The Lisle, Ill.-based company rose on the heels of industry monster

Cisco

(CSCO) - Get Report

last year. But on April 5, as the

Nasdaq

was melting, Tellabs infamously announced that earnings would not meet expectations. Tellabs shares tanked, analysts downgraded the stock and the hemorrhaging leaked throughout the tech-stock field.

But Tellabs president of global sales and services John Vaughn told investors that the pain is over. "We ran into component-part shortages which have since been corrected," said Vaughn. "Revenues continue to be strong and we see no letup in the future. The fundamentals remain very strong and we're very confident that our revenue and earnings projections will remain right where they are."

And what about the amended

First Call

consensus earnings estimate of $1.65? "We are on track and we are confident that we can deliver $1.65 this year," says Vaughn. "That's our target and that's our consensus, and we expect to come very close to that.

In other words, no more preannouncements on the way.

Tellabs says its first-quarter operating margins hit was a one-time event

Source: Tellabs

Further, Vaughn says that operating margins, which dipped dramatically from 32% in 1999 to 23% in the first quarter of 2000, would finish out the year at 30%. "We won't see that all come back next quarter," Vaughn told me after the presentation, "but you'll see sequential improvement throughout the year."

Nonetheless, the stock was off 9/16 to 48 3/4 in the half-hour after his presentation concluded.

Vaughn also dropped at hint that a big contract announcement from a Western European telco was around the corner. "I can't tell you what it is because it has not been formally announced yet," said Vaughn. "But it's a very large Western European service provider and they're buying a whole set of our services. It's clear to us that demand has not slowed."

And, indeed, from Vaughn's presentation, it seems that Tellabs is stepping right back in to face that pitch.

Cory Johnson files weekly from TheStreet.com's San Francisco Bureau. In keeping with TSC's editorial policy, he neither owns nor shorts individual stocks, although he owns shares of TheStreet.com. He also doesn't invest in hedge funds or other private investment partnerships. Johnson welcomes your feedback at

cjohnson@thestreet.com.

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