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Ordinary shares of France Telecom (FTE) fell 2.8% to €25.39 Wednesday due to a corporate release ahead of its Investor Day event reaffirming 2007 guidance and an outlook with similar forecasts for 2008, which disappointed investors. France Telecom confirmed its target for 2007 organic cash flow growth of 10% to €7.5 billion ($11B), and said it expects to generate at least that much next year. Gross operating margin is seen stable in 2007 and 2008, with revenue expected to grow in-line with its operating markets. France Telecom said its expects to pay a dividend of €1.20 to €1.30 per share in 2008.

Separately, France Telecom subsidiary mobile carrier Orange said it has sold 30,000 Apple (AAPL) iPhones since they debuted in France less than a week ago; nearly half of the sales are resulting in new subscribers for the carrier. Orange has a year-end target of 100,000 unit sales. Investors can gain exposure to France Telecom via iShares MSCI France Index (EWQ) and iShares S&P Global Telecommunications (IXP), of which it is a 4.2% and 3.4% holding, respectively.

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Source: France Telecom's Guidance Disappoints