UBS Warburg Downgrades Tekelec
Tekelec (TKLC ) cut Q2 guidance to $0.02-$0.03 earnings per share (pro forma) on $70M-$71M revenue, owing to order delays and project postponements. UBS Warburg downgraded its recommendation on the shares to hold from buy.
Analyst Nikos Theodosopoulos told S&P MarketScope that Tekelec obviously fell short of his estimates. He cut his revenue estimates for 2001 from $400M to $307M and for 2002 from $497M to $353M; he lowered his EPS forecasts for 2001 from $0.87 to $0.26 and for 2002 from $1.14 to $0.50. He notes that he downgraded the shares based on his estimate cuts; with the stock indicated at $20, he thought there was not much upside potential to the stock given his 2002 estimates. The analyst is looking for general telecom spending to come back -- which he does not anticipate near term.