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Wachovia upgraded JDS Uniphase (JDSU
) to outperform from market perform.
Analyst Stephen Koffler says numerous talks with industry players have convinced him that the appointment of Kevin Kennedy as CEO is very positive, and is likely to accelerate improvements in the company's operations that began over the last year. Koffler narrowed the 6-cent fiscal 2004 (June) loss estimate to a 5-cent loss on expectations of further cost cutting and margin expansion. He notes significant opportunities still exist to streamline operations, including manufacturing.
Koffler sees 10 cents fiscal 2005 earnings per share. He thinks the stock should trade in the $8 to $10 range, or 20 times to 25 times his $580 million fiscal 2005 revenue estimate, and 80 times to 100 times his 10 cents fiscal 2005 earnings per share estimate.