Ariana Research
Long/short equity, deep value, special situations

Tellabs: Discounted Assets With A Catalyst


Executive Summary

Tellabs, Inc. ("Tellabs" or the "Company") is a leading telecommunications networking equipment provider, which offers an attractive opportunity at current prices. Tellabs trades on NASDAQ under the ticker TLAB and has a market cap of $782.0MM and $572.0MM in net cash. In 2012, the Company derived 41% of revenues from its Optical segment, 25.2% from the Data/Router segment, 14.8% from the Access segment and 18.8% from services. The Company is geographically diversified with a ~50/50 mix between North America and International.

The Company in essence is a "Ben Graham" asset play attached with an event-driven opportunity as the Company is at an inflection point in profitability. Tellabs has recently suffered from poor performance in

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