RBC Capital analyst Mark Sue this morning reduced his rating on JDSU (JDSU) to Sector Perform from Outperform, with a new price target of $13, down from $16. He also trimmed his EPS forecast for the June 2011 fiscal year to 60 cents, from 65 cents; for FY 2012 he goes to 73 cents, from 75 cents.
The moves reflect his concerns about slowing growth in the optical components sector, which just this morning saw a Q4 warning from Oclaro (OCLR), which follows a similar recent warning from Infinera (INFN).
“We believe optical components� book-to-bill may have peaked during the spring time frame,” he writes. “JDSU has a diversifying business, and broad trends in wireless, video traffic growth may continue to support the company�s top line growth prospects looking ahead. Near term, the rate of growth may be slowing as most equipment customers may have built enough inventories to catch up with the acceleration in demand we saw earlier in the year.”
JDSU is down $1.28, or 11.1%, to $10.28.
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