The following list includes ratings changes and financial information for wireless companies announced this week by investment-banking and financial-services firms.
Carriers
- Prudential Equity Group lowered its subscriber net adds forecast for UbiquiTel Inc., and consequently its EPS forecast for the company’s fiscal 2006. Prudential’s new EPS estimate for the year is 29 cents, down from its previous estimate of 36 cents. UbiquiTel released fourth-quarter results this week.
- Credit Suisse First Boston lowered its EPS estimates and price target on Vodafone Group by 7.5 percent. The firm pointed to comments made by Vodafone indicating margins in its more mature European assets could continue to decline due to competition.
- Merrill Lynch upgraded Sprint Nextel to buy from neutral after the carrier reported fourth-quarter results that were mostly in line with estimates. Merrill Lynch said uncertainty surrounding the company is beginning to lift.
Handset and Infrastructure Vendors
- RBC Capital Markets initiated coverage on Alcatel with an outperform rating and a $17 price target.
- Harris Nesbitt raised its price target on Research in Motion Ltd. to $72 from $67 after the USPTO rejected NTP’s final claim of patent infringement against the company. A district court upheld NTP’s claims but delayed a decision about imposing an injunction on RIM.
Other
- Robert W. Baird raised its estimates on ADC Telecommunications Inc. after the company reported first-quarter earnings that were slightly below expectations. New estimates for 2006 revenues are $1.34 billion from $1.30 billion, and EPS estimates increase to $1.07 from $1. For 2007, Baird increased its revenue estimate on ADC to $1.45 billion from $1.36 billion and raised its EPS estimate to $1.40 from $1.15 on higher operating margins and a lower tax rate. Baird also raised its price target on ADC to $26 from $24.
- RBC Capital Markets lowered its price target on Crown Castle International from $37 to $34. RBC noted Crown delivered generally better-than-expected financial results.
- First Albany Capital initiated coverage on Andrew Corp. with a buy rating and a $16 price target. The firm noted growing demand for wireless products in developing countries presents a significant long-term growth opportunity for Andrew.
- First Albany Capital initiated coverage on Stratex Networks Inc. with a buy rating and a price target of $6.75. First Albany said Stratex’s Eclipse product family is producing strong results.
- Lehman Brothers raised its estimates on American Tower Corp. after the company reported strong fourth-quarter results. For 2006, Lehman expects the company to report tower revenue of $1.269 billion, up from $1.262 billion. Morgan Stanley raised its price target on American Tower from $33 to $36 after the company reported strong fourth-quarter results and offered increased 2006 guidance.
- RBC Capital Markets initiated coverage on UTStarcom Inc. with a sector perform rating and an $8 price target. RBC noted it is cautious on the company’s near-term prospects due to the company’s revenue volatility and challenges meeting its target timeline for breakeven earnings. However, the firm pointed to trends, such as high-profile IPTV wins and potential CDMA infrastructure contracts, that could put the company in a position to reach the $8 price target.
- Credit Suisse First Boston raised its estimates on Marvell Technology Group Ltd. For fiscal year 2007 the company expects revenue and EPS of $2.25 billion and $1.37 from $2.18 billion and $1.32. CSFB also raised its price target on the company from $60 to $71. Marvel reported earnings that beat CSFB’s consensus estimates. Harris Nesbit raised its EPS estimates on Marvel for 2007 and 2008 to $1.87 and $2.21 from $1.80 and $2.10 respectively. Prudential Equity Group raised its price target on the company from $59 to $74.
