The following list includes ratings changes and financial information for wireless companies announced this week by investment-banking and financial-services firms.
- Carrier
- Credit Suisse First Boston adjusted its estimates on AT&T Corp. to reflect the integration of BellSouth Corp. and Cingular Wireless. The company said it expects AT&T to add 6 million subscribers this year and raised its price target to $39 from $38. It also increased its estimates on AT&T to $2.54 from $2.50 for 2007.
- Prudential Equity Group downgraded Alltel Corp. to neutral from overweight based on price. RBC Capital Markets also downgraded the company on valuation. Merrill Lynch raised its price target on the company to $69 from $62.
- Credit Suisse First Boston downgraded SK Telecom from outperform to neutral, saying although the company will likely report solid fourth-quarter results, it is concerned about a major marketing war this year as operators prepare for 3G migration.
- Credit Suisse First Boston downgraded Sprint Nextel Corp. to neutral from outperform and reduced its price target on the company to $20 after the company pre-announced disappointing subscriber results and 2007 guidance. It also cut its 2007 estimate on the company to 86 cents from $1.32. Prudential Equity Group lowered its price target on Sprint Nextel to $17 from $19 and cut its estimates on the carrier on expected weak fourth-quarter results. Prudential lowered its EPS estimate on the company to 75 cents from $1.35 for 2007 and its revenue estimates to $41.3 billion from $43 billion. RBC Capital Markets lowered its price target and estimates on Sprint Nextel. Its new price target is $18, down from $20, and its 2007 EPS estimate drops to 65 cents from $1.06. R.W. Baird raised its 2006 EPS estimate on Sprint Nextel to $1.31 from $1.29 and lowered its 2007 estimate to 86 cents from $1.39. Merrill Lynch lowered its estimates on Sprint Nextel to $1 from $1.25 for 2007 and to $1.17 from $1.32 for 2008. Standard & Poor’s Ratings Services said it placed Sprint Nextel’s BBB+ corporate credit rating on CreditWatch Negative. Morgan Stanley lowered its price target on the company to $16 from $19 and reiterated its underweight rating.
Handset and infrastructure vendors - R.W. Baird initiated coverage on Alcatel-Lucent with a neutral rating.
- CIBC World Markets downgraded Motorola Inc. to sector perform from sector outperform after the company pre-announced lower-than-expected results for the fourth quarter. Prudential Equity Group lowered its estimates on the company to $1.12 from $1.25 for 2006. RBC Capital Markets lowered its estimates on Motorola to $1.19 from $1.32 for 2006 and to $1.22 from $1.45 for 2007 and cut its price target to $24 from $26.
- Credit Suisse First Boston cut its rating on Nokia Corp. to neutral from outperform on expectations of a weak fourth quarter.
Other - CIBC World Markets downgraded Brightpoint to sector perform from sector outperform, saying it expects fourth-quarter handset volume to slow for the company despite industry strength. In addition, for 2007 the company lowered its estimates on Brightpoint to 82 cents on revenues of $2.75 billion from 95 cents on revenues of $2.78 billion.
- Prudential Equity Group raised its estimates on RadioShack Corp. after the company provided preliminary fourth-quarter results that were better than expected. Prudential’s new estimates on the company are 78 cents rather than 67 cents for 2006.
- First Albany Capital lowered its estimates on Tellabs Corp. after the company said it expects to report lower-than-forecasted results for the fourth quarter. New estimates are EPS of 49 cents on revenues of $2.05 billion from 53 cents on $2.11 billion for 2006 and 47 cents on $2.09 billion from 55 cents on $2.24 billion for 2007. R.W. Baird also lowered its estimates on Tellabs to 58 cents from 62 cents for 2006 and to 55 cents from 66 cents for 2007. It also lowered its price target to $10. Prudential Equity Group lowered its 2006 estimates on the company to 50 cents from 56 cents. Lehman Brothers lowered its estimates on the company to 48 cents from 52 cents for 2006 and to 45 cents from 59 cents for 2007.
- Credit Suisse First Boston downgraded Broadcom Corp. to underperform from outperform and lowered its price target to $26 from $30. The firm said it believes Broadcom will experience a temporary product cycle lull in 2007.
- R.W. Baird lowered its estimates on Openwave Systems after the company pre-announced lower-than-expected revenues for its fiscal second quarter. Baird lowered its 2007 revenue and adjusted EPS estimates from $370.6 million and 7 cents to $350.6 million and a loss of 6 cents per share. It also lowered its fiscal 2008 revenue forecast to $395.9 million from $411.7 million, but raised its EPS estimate to 46 cents from 43 cents. Lehman Brothers also lowered its forecasts on Openwave, to a loss of 13 cents from a loss of 2 cents for 2007.
