Qwest Estimates Cut, Growing Line Losses Seen

Qwest (Q) shares are lower following negative comments Friday morning from Bear Stearns analyst Mike McCormack. He cut his EPS estimates on the company for 2008, citing “ongoing competitive pressures and expectations for less incremental benefit from cost-cutting initiatives.”

McCormack now sees primary residential access lines down 9.5% in 2008, down from a previous forecast of down 8.6%. And he sees DSL net adds now at 386,000, below his previous estimate of 426,000. He also says that given significant cost cutting last year, Qwest has fewer options to trim facility and employee-related costs this year.

McCormack trimmed his 2008 EPS estimate to 35 cents from 39 cents; the Street consensus is 45 cents. He thinks other numbers will have to come down, and advises investors to “stay on the sidelines.”

Qwest Friday was down 15 cents, or 2.8%, at $5.13.

Comments

[Ames Tiedeman]

This is a real turn around stock. Not XO.