Motorola: Could it get any worse?

Motorola shares hit a five-year low today after analysts weigh in with negative reports. The stock is down nearly 6% to $7.48 at noon PST. Don't listen to that inner voice whispering that now might be a good buying opportunity. Things aren't looking up for this company anytime soon.

PiperJaffray downgraded Motorola to "sell" from "neutral" today and cut the price target to $7 from $9.75. The analyst also lowered his handset forecast for the year to 106 million from 116 million. Part of the reason for the downgrade is because Motorola is so exposed in North America. Nearly half of its handset sales are on that continent. So it's not a good sign that the four major North American wireless carriers are seeing declining sales.

A Deutsche Bank analyst suspects Motorola will be hurt by consumers putting off new cell phone purchases in order to pay for basic items like gas and food, according to Barron's. The analyst said Motorola's near-term is "bleak," and cut his target on the stock to $12 from $13. The analyst also said Motorola's share of the global handset market this year will drop to 6.1% from 8.1%.

Motorola wants to spin off its handset division, but PiperJaffray says that move is unlikely in the near-term.

Related reading:

Spinoff could put Motorola in poorhouse

Motorola's next hit will have to create itself

Like torture? Motorola has a job for you

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Comments

 

Motorola has a great cell phone which is only available in Hong Kong.  My friend and I were in Hong Kong about 3 years ago bought that phone and we are still using it.  I also bought my wife one because of all the features it has.  This phone has everyting the iPhone has but had it 4 years ago.  This phone also has a business card scanner which scans a business card and read the vital info and place them into your existing phone directory.  They were suppose to release this phone by Xmas of 2006 in the US, but decided not to the last minute.  These are the kind of bad decisions which take a good company down.  BTW, this phone is still available in Hong Kong, but for a$200 less than what we paid 4 years ago.

CW (Posted 07.29.08 5:22 PM) Report Abuse

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