CSFB has negative note. Here it is:
MOTOROLA (MOT: $14.95) 4/6/01
More Tough Times Ahead
Annual EPS Prev. EPS
12/02E $0.58
12/01E $0.11
12/00A 0.84
Rating: BUY Change: 12-Mo. Target: N/A
Motorola releases its first quarter earnings at 5:30 PM ET on Tues. Apr. 10th.
We have twice revised projections lower this quarter, so we do not expect additional downside to our current March quarter forecasts of $7.66B in revenue and a loss per share of ($0.07).
We currently estimate 2001 EPS at $0.11, below consensus of $0.14, on revenues of $36.1 billion. Because of continued weakness in three of the company's key businesses, we expect consensus EPS to fall even below our estimate. Our worst case scenario shows break-even EPS for the year on $34.0-34.5 billion in revenues.
The handset segment is being impacted by aggressive pricing, an inventory overhang, and a lack of new products. We also see risk to our 2001 infrastructure estimate of 13% growth due to carrier order pushouts and a lack of new contracts. Semiconductors should continue to be impacted by weak end-markets and inventory builds.
Broadband should be the bright spot in the quarter. However, we see guidance staying at recently reduced levels at the best due to capital spending concerns and inventory builds at some major customers.
We are assuming coverage with a BUY rating. The stock is trading near the low end of its 10 year range at 1x 2001 sales. However, we do not see a major catalyst until the second half of this year, at the earliest, and expect downward pressure on '01 and '02 numbers. |
