In a recent note to clients, Lehman Brothers analysts Jeff Kvaal and Tim Luke suggest that recent weakness in Openwave's shares presents a buying opportunity. They anticipate that Openwave will sign a major systems deal that will be recognized in June 2006:
Given 1) strength in the overall data application market 2) Openwave's strong and expanding positioning in the carrier services and 3) potential upside to consensus numbers due to better than expected operating margin performance and potential upside to Musiwave performance, we believe that current concerns may be overdone. Our price target remains $25 or 24x our CY06 operating EPS of $0.87 plus $4 a share in cash.
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