Chicago, IL – October 29, 2009 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Qwest Communications (Q), Alcatel-Lucent (ALU), AT&T (T), Verizon (VZ) and Sprint Nextel (S).

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Here are highlights from Wednesday’s AnalystBlog:

Qwest Meets, Boosts Outlook

Qwest Communications (Q) continues to invest in building necessary infrastructure to boost network capacity and availability. The company is devoting a major portion of the overall CapEx in expanding its fiber-to-the-node (FTTN) network capacity to increase broadband network performance. FTTN deployments reached over 3 million homes with 500,000 homes added in the quarter.

Through a joint venture with Alcatel-Lucent (ALU), Qwest is upgrading its fiber-based network infrastructure to offer top Internet speeds of 100 gigabits per second (Gbps). Recently, the company introduced a new fiber-based Ethernet backhaul wholesale service for wireless operators. We expect these new business opportunities to drive growth moving forward.

However, Qwest remains more challenged than the other regional telephone companies (Baby Bells) in the US such as AT&T (T) and Verizon (VZ) given the lack of its own wireless and satellite TV services. This has prevented Qwest from achieving meaningful penetration in these lucrative markets.

Qwest’s transition from a mobile virtual network operator (MVNO) to wireless reseller has resulted in lower wireless revenue. Since 2004, the company has been marketing Sprint Nextel’s (S) wireless products and services under its own brand by operating as an MVNO on Sprint’s network. However, Qwest will officially terminate this service on Oct. 31, 2009. Nevertheless, the company will continue reselling Verizon’s products and services (under Verizon brand).

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The provider of optical networking equipment, software and services diversified beyond emerging carriers, and now counts the world's largest telecom service providers as its customers, including Verizon (VZ), AT&T (T), BT Group (BT) and Qwest Communications (Q).

Ciena's cost cutting efforts will trim operating expenses, helping it achieve breakeven results in the coming quarters.

Moreover, the company has a healthy balance sheet with improving cash metrics. The company exited the current quarter with $922.6 million in cash and short-term investments, compared to $917.0 million in the previous quarter. Long-term debt (convertible notes payable) at the end of the quarter remained at $798.0 million.

However, the company's sales cycle is lengthening, as Tier 1 carriers proceed with caution, given the economic uncertainty. Moreover, the telecommunications market is full of competitors, such as Alcatel-Lucent (ALU), Cisco (CSCO), Ericsson (ERIC), Nokia Corp. (NOK), Nortel Networks (NT) and Tellabs (TLAB), which are premier companies in the telecommunication space posing a threat to Ciena.

Shares of Ciena, surged 2.5% to $13.53 in after-hours trading yesterday and closed at $13.20, a rise of 3.04%. In our view, the sharp increase in price is due to a recovery in the telecommunications sector.

Among key industry indexes, the Dow Jones U.S. Fixed Line Telecommunications Total Stock Market Index increased 0.8% to 904 points, while the Dow Jones U.S. Telecommunications Equipment Total Stock Market Index increased 1.1% to 5,169 points yesterday.

• Time Warner (NYSE:TWX) reported second quarter adjusted earnings 45 cents a share, ahead of consensus estimates of 37 cents a share, on revenues of $6.81 billion, versus estimates of $6.97 billion. The firm maintained its 2009 earnings guidance of flat adjusted results from continuing operations versus $1.98 a year ago

• Moody's (NYSE:MCO) second quarter earnings exceeded estimates by 3 cents at 43 cents as revenues fell 7.6% to $451 million

• Medco Health Solutions (NYSE:MHS) reported second quarter earnings of 69 cents, 4 cents ahead of estimates

• Qwest Communications (NYSE:Q) reported earnings of 13 cents, 3 pennies above estimates, on in-line revenues of $3.1 billion, that was off 9% from a year ago

• Textron (NYSE:TXT) reported second earnings of 8 cents ex-items, 11 cents above Street estimates of a loss as revenues fell 29.1% to $2.61 billion. The firm said it now sees full-year earnings of 33 cents to 63 cents a share, compared with its prior view of 45 cents to 75 cents a share and ahead of consensus estimates of 22 cents

• General Dynamics (NYSE:GD) reported earnings of $1.60, topping estimates of $1.57 and upped its guidance for the full year by a nickel to $6.05-$6.15

• Sprint Nextel (NYSE:S) reported a second-quarter loss of 13 cents a share, an 11-cent miss, on in-line revenues, down 10%, to $8.1 billion

• ArcelorMittal (NYSE:MT) reported a 57 cent per share, or $792 million, second quarter loss versus $4.19 a year ago and estimates of a $336 million profit, as revenues fell 60% to $15.18 billion from $37.84 billion