Analysts making dramatic forecast cuts
Posted
Sep 12 2008, 04:36 PM
by
Kim Peterson
Rating:
Analysts have been busy channeling Sweeney Todd this week, making dramatic cuts across the board. No industry appeared safe from the chopping. Thanks to Barron's for providing a nice roundup.
In the big picture, analysts are realizing that they overreached on profit estimates for companies. Money managers have been complaining about this for a while now. Were the analysts just overly optimistic in the first place, or has the oft-cited "macro environment" gotten worse? Both.
Here's a roundup of the latest cuts:
Apple: American Technology cuts estimates for the current year by 5 cents to $5.29. Next year's estimates cut by 20 cents to $6.15. Analyst says customers shifting to lower-priced Macs.
AT&T: Credit Suisse cuts 2009 EPS estimate to $3.28 from $3.33, expressing concerns about the wireless business and customer acquisition costs.
Baidu: Pacific Crest cuts price target for the Chinese search company to $360 from $405.
Bank of America: RBC cuts profit estimates after the bank said it would buy back $4.5 billion in securities.
Best Buy: UBS cuts rating to Neutral, cuts price target to $48 from $59 and cuts EPS. Cites excess inventory in LCD televisions, among other issues.
Computer chips: American Technology went on a rampage through semiconductor stock land, cutting ratings on nine companies to Neutral. Analyst says that macro factors will "limit consumption of discretionary consumer electronics devices."
Goldman Sachs: Keefe, Bruyette & Woods cuts profit estimates, expecting lower equities trading revenue.
Intel: Friedman Billings cuts EPS estimate for 2009 by 5 cents, cites weakening demand.
Titanium industry: Longbow Research cuts expectations for several companies in the titanium business, citing delays in Boeing's 787 program.
Verizon: Credit Suisse cuts 2008 estimate by a penny and 2009 estimate by 2 cents.
