Weekly wireless ratings wrap-up

The following list includes ratings changes and financial information for wireless companies announced this week by investment-banking and financial-services firms.

Click here for wireless ratings from past weeks from RCR Wireless News.

Carrier

• Standard & Poor’s Ratings Services raised its short-term rating on Qwest Communications International Inc. to B-1 from B-2. “This upgrade is supported by expectations of continued strong liquidity and reduced event risk, given expectations that the proposed shareholder lawsuit settlement related to consolidated securities action against Qwest will largely address many remaining overhang concerns,” said Standard & Poor’s credit analyst Catherine Cosentino.

Handset and infrastructure vendors

• Prudential Equity Group lowered estimates on Nortel Networks Corp. after the company reported lower-than-expected first-quarter results. Its 2006 EPS estimate drops from 12 cents to 7 cents and its 2007 EPS estimate drops from 26 cents to 22 cents.

Other

• CIBC World Markets raised its estimates on Qualcomm Inc. after the company raised its second-quarter guidance to reflect stronger-than-expected shipments and ASPs during the quarter. For 2006, CIBC now expects revenues of $7.53 billion from $7.47 billion and EPS estimates move to $1.66 from $1.65. Harris Nesbitt also raised its estimates on Qualcomm following the news. For 2006 it expects EPS of $1.64 rather than $1.60. Prudential Equity Group raised its fiscal 2006 EPS estimate on Qualcomm to $1.45 from $1.42. RBC Capital Markets raised its 2006 EPS estimate on the company to $1.65 from $1.61 and its 2007 EPS estimate to $2.00 from $1.92.

   

• RBC Capital Markets raised its estimates on Comverse Technology Inc. after the company reported a positive earnings update. Revenues for fiscal 2006 are expected to reach $1.59 billion and EPS is expected to be 88 cents, up from 86 cents.

   

• Prudential Equity Group raised its rating on Harris Corp. from underweight to neutral based on recent weakness on the company’s stock price.

   

• CIBC World Markets upgraded Powerwave Technologies from sector perform to sector outperform and assigned a price target of $13 to the company based on its pending merger with Filtronic.

   

• Prudential Equity Group raised its sector rating on the semiconductor industry from unfavorable to favorable, saying inventory levels are low and manufacturing utilization rates are at about 90 percent. As part of the upgrade, Prudential raised its rating on STMicroelectronics from underweight to neutral.

   

• First Albany Capital lowered its estimates on LCC International Inc. on news of its plans to sell its U.S. deployment business as well as an expected overhang from the divestiture during the third quarter. For fiscal 2006, revenue estimates decrease to $153.4 million from $161.2 million and EPS estimates change from a loss of 11 cents to a loss of 13 cents.

   

• RBC Capital Markets raised its estimates on Texas Instruments Inc. after the company raised guidance. Its new EPS estimate for 2006 is $1.66, up from $1.59. Harris Nesbitt also raised estimates on the company, largely on the expected impact of patent settlements. New estimates for the year are EPS of $1.88 rather than $1.80 for 2006, and EPS of $2.10 rather than $2.05 for 2007. Prudential Equity Group also increased its estimates on TI. 2006 EPS estimates increase to $1.76 from $1.66 and 2007 EPS estimates increase to $2.23 from $2.17. Credit Suisse First Boston raised its estimates on TI to 41 cents on $3.61 billion in revenues for 2006, up from 41 cents on $3.58 billion in revenues. R.W. Baird’s EPS estimate on TI for 2006 jumps to $1.76 from $1.70.