) with buy.
Analyst Joseph Wolf says he has a high level of conviction that electronics-equipment maker Solectron is able to head towards profitability, a more competitive operating model, and an improved return on invested capital over the next fiscal year, and under Mike Cannon's leadership. Wolf thinks Solectron's revenue base is stable, and says restructuring will bring the company's operating costs down from almost 7% of sales to 4% of sales by the end of fiscal 2005.
Wolf sees cash flow from operations and potential assets sales addressing the bulk of a $1 billion convertible debt obligation due next May, without the need for new issuance. He sees a 16-cent fiscal 2003 (Aug.) loss, and 9 cents fiscal 2004 earnings per share, as well as 41 cents earnings per share in fiscal 2005. Wolf set a $9 target.