Citing Nortel’s prospects in the CDMA business this year, UBS Securities has raised its EPS and revenue targets to $12.12-billion and $0.66 respectively from $11.96-billion and $0.56. UBS also raised its stock target price to $26 from $23.50.
In 2008, UBS is looking for revenue and EPS targets to $12.4-billion and $1.50 compared with earlier estimates of $12.54-billion and $1.60 as it expects CDMA sales to decline by 6% to reflect the completion of Rev A rollouts (as opposed to earlier estimates of a 5% increase).
In terms of Nortel’s failure to be selected as one of Sprint’s three WiMax suppliers, UBS said this “is a disappointment given NT’s incumbency and focus to win the deal. We believe this loss may cause NT to reevaluate its overall wireless strategy and possibly deemphasize wireless longer term.”
On a positive note, UBS expects Nortel will focus on boosting its enterprise business in 2007 so it can become a “meaningful #2 to CSCO. We continue to believe NT would have to look at acquisitions to strengthen its enterprise portfolio, particularly in enterprise data”. Update:TheStreet.com covered the news as well.
UBS Raises 2007 Estimates, Target Price
Citing Nortel’s prospects in the CDMA business this year, UBS Securities has raised its EPS and revenue targets to $12.12-billion and $0.66 respectively from $11.96-billion and $0.56. UBS also raised its stock target price to $26 from $23.50.
In 2008, UBS is looking for revenue and EPS targets to $12.4-billion and $1.50 compared with earlier estimates of $12.54-billion and $1.60 as it expects CDMA sales to decline by 6% to reflect the completion of Rev A rollouts (as opposed to earlier estimates of a 5% increase).
In terms of Nortel’s failure to be selected as one of Sprint’s three WiMax suppliers, UBS said this “is a disappointment given NT’s incumbency and focus to win the deal. We believe this loss may cause NT to reevaluate its overall wireless strategy and possibly deemphasize wireless longer term.”
On a positive note, UBS expects Nortel will focus on boosting its enterprise business in 2007 so it can become a “meaningful #2 to CSCO. We continue to believe NT would have to look at acquisitions to strengthen its enterprise portfolio, particularly in enterprise data”.
Update: TheStreet.com covered the news as well.
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