Avaya Moving in the Right Direction

October 5, 2005

Avaya received plenty of praise Wednesday in a research report issued by SG Cowen & Co., which stated that "we believe 'AV' shares could outperform the market by 30-50 percent" during the next 12 months.

"We believe that Avaya's valuation multiple can expand over the coming year as the company demonstrates that it can improve its operating margins and grow once again," the report said.

The report stated that new products targeting branch offices and enterprise mobility should drive continued growth. It also stated that "we believe that Avaya's recent product and services introductions have focused on bringing the company's core enterprise voice technology to any device at any time.

"We believe that Avaya's strategy to bring its enterprise-level voice functionality to any device at any time effectively leverages the company's strong position in communication applications such as unified messaging and contact center. More broadly, this strategy is indicative of Avaya's transformation from a legacy voice hardware-focused company into a software applications-focused company."

By Glenn J. Kalinoski, Executive Editor, Customer Inter@ction Solutions