Roth Capital downgraded Wireless Facilities (WFII) to neutral from buy, after the company posted weak quarterly results.
The company posted a 5 cents earnings per share (EPS) fourth quarter loss compared to 16 cents EPS during the year ago period.
Analyst David Kang says Wireless Facilities will get its act together and put together a string of solid quarters. He also believes the company is faced with a number of opportunities in 2006, as several operators in the wireless industry are in the midst of a 3G upgrade. In addition, he says the company is starting to focus on IP networks. However, the bottom line for Wireless Facilities is that it needs to execute, and until it does, he recommends investors stay on the sidelines. He cut his 23 cents 2006 EPS estimate to 15 cents and his 32 cents EPS 2007 estimate to 25 cents EPS. He also reduced his $7 stock price target to $5.