) to neutral from strong buy, after the company posted lower third quarter earnings per share.
Analyst Adam Greene thinks the shares are likely to be range bound until investor confidence is restored and visibility increased. He says the third quarter was a huge disappointment on both the top and bottom lines due to customer inventory reductions. Specifically, he says 7 cents third quarter earnings per share on $72.5 million in revenue compares to his estimates of 28 cents earnings per share on revenue of $81 million. He slashes his $1.01 2005 earnings per share estimate to 60 cents, and his $1.76 2006 estimate to $1.06, although he has low confidence in estimates. Despite the drop in stock price, he believes it is necessary to move to the side-lines.