Telecom Worries Send WorldCom Shares Lower

Shares of AT&T;’s archrival, WorldCom Inc., slumped to a new multi-year low Wednesday on fears that corporate spending on telecom services won’t revive soon.

WorldCom Group, the stock that represents the company’s commercial data and Internet businesses, slid 66 cents, or 12%, to $4.77 on Nasdaq, the lowest price since 1992.

WorldCom MCI, which tracks the firm’s long-distance unit, dropped 60 cents, or 12%, to $4.32, also on Nasdaq. The MCI stock began trading last year.

WorldCom’s bonds also tumbled in value, traders said.

The company’s investors worry that “slow growth in revenues for the telecom industry will continue throughout 2002,” said Rosemarie Kalinowski, an analyst at Standard & Poor’s, which rates the company’s debt BBB-plus, three notches above junk status. The rating company has a negative outlook on the debt, meaning WorldCom is more likely to be downgraded than not.

WorldCom, which is the subject of an accounting investigation by the Securities and Exchange Commission, said in February that its data unit’s 2002 sales would rise by a mid-single-digit percentage rate. But some analysts expect the forecast will be reduced when the firm posts first-quarter results April 25.

Some analysts also have warned that the firm is likely to cut the dividend it pays on the MCI stock. The annual dividend now is $2.40 a share, which provides a huge annualized yield of 55.5% based on the stock’s closing price Wednesday--that is, if the company continues the dividend at the current rate.

Claire Hassett, a spokeswoman for Clinton, Miss.-based WorldCom, declined to comment.

WorldCom is cutting network costs to make up for slowing sales. The company last week announced the elimination of 3,700 jobs at the data unit.