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Schooling the Street

5:00 PM -- Does Wall Street have unfair expectations for equipment vendors selling next-generation networking equipment?

Cantor Fitzgerald analyst Edward Jackson thinks so.

Noting a 15-percent drop in shares of Acme Packet Inc. (Nasdaq: APKT) today, and a 40-percent drop in shares of Veraz Networks Inc. (Nasdaq: VRAZ), Jackson says he thinks the market might have gotten ahead of itself.

"There are a lot of people who were expecting a lot of momentum in the next-generation VOIP world. Things are looking very good in that segment in general."

Unfortunately, that has led to very high expectations, some of which might be overblown.

"I find it somewhat comical that investors can be disappointed in a company can grow revenues at a 30-percent clip. It used to be, if a company could grow revenues 30 percent, it was just a rock star. But with the telecom bubble, things have changed," Jackson says about the expectations for companies like Acme Packet.

"In some regards," he says, "the Street needs to grow up."

— Ryan Lawler, Reporter, Light Reading

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