CSFB Lowers OpenWave Rating

Analyst Tim Long cites further next-generation network pushouts, spending reductions by European carriers, and lower-than-consensus handset sales projections

OpenWave (OPWV ) sees a worse than expected $0.17-$0.22 fourth-quarter loss per share (pro forma) on revenues of $64-$71 million. CS First Boston downgraded its rating on the shares to hold from buy.

Analyst Tim Long says he downgraded OpenWave and cut his estimates for wireless data revenues following the company's pre-announcement. He based his downgrade on further next-generation network pushouts, continued European carrier spending reductions, and lower than consensus handset sales projections. Long sees a $0.19 Q4 loss and a loss of $0.37 for all of fiscal 2002 (ending June). He cut his $395 million fiscal 2003 sales estimate to $320 million, and widened his $0.07 fiscal 2003 loss estimate to a $0.37 loss. He also cuts his $8 price target to $5. Long plans to revisit his estimates following the company's conference call scheduled for July 23.

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