Bear Stearns downgrades Sanmina-SCI (SANM) to peer perform from outperform.
Analyst Thomas Hopkins believes Sanmina-SCI is likely to report in-line second-quarter results. He expects the company to guide sequentially higher but that guidance is likely to be weaker than current consensus estimates due to a stagnant customer mix.
He says his Sanmina-SCI downgrade brings the individual stock pick in line with Septneber 2004 sector downgrade. He notes a cloud over telecom capital expenditure spending (due to consolidation) is problematic for the electronic manufacturing services turnarounds.
Hopkins cuts his $11 target to $8. He cuts his 31 cents fiscal 2005 (ending September) earnings per share estimate for Sanmina-SCI to 28 cents and 52 cents fiscal 2006 to 36 cents.