) to outperform from neutral.
Analyst Matt Hoffman says his upgrade is part of an improved outlook for the wireless equipment industry in 2003. He says the eight-million-unit inventory overhang from the fourth quarter of 2002 resulted from overproduction, not weak demand. Hoffman says underlying phone demand is better than expected, driven by strong subscriber growth. As such, he raised his 445 million unit 2003 handset market estimate to 458 million.
Hoffman says he would be a buyer of Nokia, as the stock is trading at trough levels. He raised the $16 target to $18, and upped the 84 cents 2003 earnings per share estimate to 85 cents. He also upped the $32.8 billion revenue estimate to $32.9 billion. Hoffman sees 97 cents 2004 earnings per share, and raised the $36.5 billion revenue estimate to $36.6 billion.