Frost Upgrades Globespan to 'Strong Buy'

Analyst Cody Acree sees stronger gross margin, and a profit in 2002 for the DSL equipment maker, as orders are picking up

Frost Securities upgraded Globespan Inc. (GSPN ) to to strong buy from buy.

Analyst Cody Acree says the company is starting to see orders picking up, and is also showing diversity in its global customer base. He adds that inventories are being worked down; the company expects normal levels by the end of the year, if not sooner.

Acree says valuation is quite attractive at current levels, and adds that his gross margin assumptions have been light. Therefore, with gross margin improvements, he narrowed the $0.09 Q3 loss estimate to a $0.08 loss, and narrowed the $0.07 Q4 loss to a $0.06 loss.

Acree also raised his $0.01 2002 loss estimate to $0.03 EPS. He has a $35 price target.

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