CS First Boston Narrows Loss Estimates for AvantGo

After the company posted a narrower than expected Q4 loss, analyst Todd Raker also moved up his timetable for profits by two quarters

Credit Suisse First Boston narrowed its loss estimates for AvantGo (IBM ) after the mobile content provider, which caters to individual personal digital assistant or PDA users, posted a narrower than expected fourth quarter loss of $0.35 from operations. The company said it also sees a 2002 loss of $1.23-$1.39 from operations.

Analyst Todd Raker noted fourth quarter revenues of $6.6 million rose 42% compared to the third quarter, and exceeded his estimate of $5.3million. He also said the 77% gross margins beat his estimates, and that the $0.35 operating loss was narrower than expected.

Raker raised his 2001 revenue estimates to $35.2 million from $29.3 million, and narrowed his 2001 loss estimate to $1.32 from $1.52 in light of latest company guidance. The analyst also said the company in 2001 expects to benefit from a larger direct salesforce, additional partnerships, and trending growth in corporate adoption of mobile technology. Raker also moved his timetable for profitability forward by two quarters, in line with AvantGo's guidance. His price target on the stock is $22, and rated a buy.

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