CS First Boston Cuts Nokia to 'Buy'

Analyst Jason Babick thinks falling revenue estimates for the cell phone maker will likely limit an upside in shares

CS First Boston downgraded Nokia (NOK ) to buy from strong buy.

Analyst Jason Babick says his downgrade reflects below consensus views on the wireless equipment market, and the impact on Nokia. He says he believes falling revenue estimates will likely limit an upside in shares. He sees 410 million units global handset build vs. 420 million that came from Nokia's guidance announcement. Babick sees the company's CDMA market share declining over the next few quarters. He maintains his $0.70 2002 EPS estimate, and $0.80 for 2003. He also thinks consensus estimates still are too high. Babick sees a risk to Nokia's second half infrastructure guidance due to 3G revenue recognition issues. He cut his $29 target to $26, and sees medium-term stock weakness.

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