Reuters
RESEARCH ALERT-Deutsche Bank trims Lucent estimates
Tuesday July 8, 12:01 pm ET
CHICAGO, July 8 (Reuters) - Deutsche Bank Securities on Tuesday trimmed its sales and earnings estimates for telecommunications equipment maker Lucent Technologies Inc. (NYSE:LU - News), citing concerns over soft second-quarter sales in its wireless unit.
Analyst George Notter, in a research note, said recent negative anecdotes about Lucent's business with Verizon Wireless in the second quarter reinforced his view. He also remains concerned that Lucent's business with India's Reliance Infocom will be less strong than in the previous quarter.
The analyst said he expects a solid second quarter for telecom equipment suppliers. However, industry challenges remain the same, with excess network capacity, soft business trends at carrier customers, difficult carrier balance sheets, and regulatory uncertainty.
Notter expects the potential impact of a strike at Verizon Communications (NYSE:VZ - News), seasonal softness in Europe and perhaps lingering effects from the Severe Acute Respiratory Syndrome outbreak will dampen the third-quarter outlook.
Notter trimmed his estimate for Lucent's second-quarter sales to $2.27 billion from $2.44 billion. He trimmed fiscal 2003 and 2004 sales estimates to $9.01 billion and $9.39 billion from $9.31 billion and $10.06 billion, respectively.
He widened his loss forecast for fiscal 2003, before one-time items, to 35 cents a share from 33 cents. He cut his fiscal 2004 profit forecast by a penny, to 4 cents a share.
Notter maintained a "hold" rating on Lucent stock. |
