Telecom Equipment Makers Downgraded on Cuts and Cancellations

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 |  Includes: APKT, ARRS, ARUN, CBEY, NSR, SNCR
by: Eric Savitz

ThinkEquity’s Eric Kainer Monday morning cut his ratings on a host of companies providing telecom-related equipment and services. “We hear of continued reviews of capital programs across the communications industry,” he writes. “The delays, cuts and cancellations are likely to continue longer than we had previously expected, although perhaps no deeper than anticipated.” He says no recovery appears likely before late 2009, and even that is not assured.

Here’s a rundown on his ratings cuts:

  • Acme Packet (NASDAQ:APKT): To Source of Funds from Accumulate; target maintained at $4.50; cuts 2009 estimates to $121.1 million in revenue and profits of 23 cents a share, from $131.1 million and 31 cents.
  • ARRIS Group (NASDAQ:ARRS): To Source of Funds from Accumulate; target maintained at $7.50; ‘09 to $1.187 billion and 75 cents a share from $1.254 billion and 87 cents.
  • Synchronoss (NASDAQ:SNCR): To Source of Funds from Accumulate; target remains $9; ‘09 now $121.4 million and 40 cents, from $128.5 million and 47 cents.
  • Cbeyond (NASDAQ:CBEY): To Accumulate from Buy; target remains $17; ‘09 revenues to $415.5 million from $430.9 million; EBITDA to $58.6 million from $63.8 million.
  • Aruba Networks (NASDAQ:ARUN): To Accumulate from Buy; target remains $3; 2009 estimates go to $191 million and a penny a share from $200 million and six cents.
  • NeuStar (NYSE:NSR): To Source of Funds, from Accumulate; target remains $17; 2009 estimates to $524.2 million and $1.40, from $533.7 million and $1.41.

In Monday’s trading:

  • Acme Packet is down 51 cents, or 10.3%, to $4.43.
  • ARRIS is down 43 cents, or 5.4%, to $7.52.
  • Synchronoss is down 94 cents, or 8.7%, to $9.87.
  • Cbeyond is down 75 cents, or 4.5%, to $15.90.
  • Aruba Networks is up 19 cents, or 7.3%, to $2.81.
  • NeuStar is down 43 cents, or 2.2%, to $19.21.