) to buy from strong buy.
Analyst Keith Dunne says lower revenue from Cisco and Lucent have decreased utilization levels, and the continued impact of inventory buildup should negatively affect gross margins for rest of fiscal 2001 (Sept.). Dunne cut the $1.30 fiscal 2001 (Sept.) cash EPS estimate to $1.00-$1.05, and cut the $1.65 fiscal 2002 to $1.25.
He believes the company's major challenge in fiscal 2001 are to increase its capacity utilization levels, which he estimates at about 60%-65% currently, resulting in gross margins of about 12%. Dunne would like to obtain greater visibility into the short-term demand situation.