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
- Credit Suisse First Boston adjusted its estimates on Alltel Corp. to reflect the spinoff of its wireline business. The company’s price target drops to $53 from $66 and its 2006 EPS estimate goes to $3.15 from $3.75. Lehman Brothers lowered its price target on Alltel to $65. RBC Capital Markets adjusted its price target on the carrier to $59 from $71.
- Prudential Equity Group started coverage of the telecommunications services sector with a favorable rating. The firm’s initial coverage includes AT&T Inc., BellSouth Corp., Verizon Communications Inc., Sprint Nextel Corp. and Qwest. Prudential rates Verizon at underweight with a $31 price target; Sprint Nextel at neutral with a $21 price target; Qwest at neutral with an $8 price target; AT&T with an overweight rating and a $34 price target; and BellSouth at overweight with a $45 price target.
Handset and infrastructure vendors
- Prudential Equity Group raised its 2006 EPS estimate on Nokia Corp. to $1.23 from $1.20 after the company’s second-quarter revenues came in above expectations. RBC Capital Markets lowered its estimates on Nokia for 2006 to $1.29 from $1.40 and for 2007 to $1.41 from $1.47. The company noted pressure on Nokia’s mobile device market share. BMO Capital Markets lowered its 2006 EPS estimates on the company to $1.24 from $1.29 and raised its 2007 EPS estimate to $1.43 from $1.42. CIBC World Markets lowered its EPS estimate on Nokia for 2006 to $1.32 from $1.37 and raised its estimate for 2007 to $1.70 from $1.65. Cowen & Co. initiated coverage on Nokia with a neutral rating.
- CIBC World Markets raised its 2006 EPS estimate on Motorola Inc. to $1.35 from $1.33, saying the company is executing and it believes there is more upside possible. 2007 estimates increase to $1.54 from $1.50. BMO Capital Markets raised its 2006 pro forma EPS estimate on Motorola to $1.34 from $1.30 and its 2007 estimate to $1.51 from $1.43 on the company’s second-quarter report, which beat BMO’s estimates. Credit Suisse First Boston raised its 2006 revenue estimate on the company to $44.2 billion from $41.3 billion and its 2007 estimate to $48.2 billion from $44 billion. It also raised the company’s 2006 EPS estimate to $1.40 from $1.36 and its 2007 EPS estimate to $1.63 from $1.55. RBC Capital Markets raised its EPS estimates on Motorola to $1.31 from $1.29 for 2006 and to $1.43 from $1.42 for 2007.
Other
- RBC Capital Markets lowered its price target on Openwave Systems from $9 to $7 on lower-than-expected first-quarter guidance. RW Baird lowered its price target on Openwave to $8 and decreased its FY2007 EPS estimate on the company to 44 cents from 55 cents.
- Credit Suisse First Boston upgraded Qualcomm Inc. to outperform from neutral but lowered its FY06 estimates on the company to $1.64 from $1.67. CSFB said it expects W-CDMA adoption to continue to accelerate in 2006. CIBC World Markets adjusted its estimates on Qualcomm on good results but a disappointing outlook. The firm said Qualcomm’s chipset market share may be peaking. For FY06, CIBC expects revenues of $7.5 billion and EPS of $1.63 from $7.48 billion and EPS of $1.65. For FY2007 its revenue estimate decreases to $8.58 billion from $8.75 billion and EPS drops to $1.80 from $1.87. CIBC also lowered its price target on Qualcomm to $45 from $60. RBC Capital Markets lowered its EPS estimates on Qualcomm to $1.62 from $1.65 for 2006 and to $1.91 from $2 for 2007.
- RBC Capital Markets lowered its estimates on RadioShack Corp. for the second quarter and full year, noting the company’s core wireless business continues to struggle. For the second quarter, RBC expects the company to report EPS of 13 cents rather than 14 cents, and for 2006 it expects EPS of $1.10 rather than $1.15. The firm also reduced its 2007 estimates on the retailer to $1.25 from $1.35. Lehman Brothers lowered its second-quarter estimates on the company to 15 cents from 18 cents.
- First Albany Capital raised its estimates on Stratex Networks Inc. after the company said its fiscal first-quarter 2007 results are expected to come in at the high end of guidance. For 2007, Fist Albany expects 2007 EPS to be 20 cents from 19 cents and its revenues for the year to be $260.8 million from $258.4 million.
