Cantor Fitzgerald Initiates Coverage on Airvana (AIRV) with a Hold; Leading RNC Provider, But Several Risks
AIRV Hot Sheet
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Cantor Fitzgerald initiates coverage on Airvana, Inc. (Nasdaq: AIRV) with a Hold. Price target $7.50.
Cantor analyst says, "Pro forma revenue is based on quarterly billings, as is pro forma COGS. Pro forma results also utilize a 38.0% tax rate and exclude acquisition amortiization and stock compensation expense...We are initiating coverage on Airvana with a HOLD rating and a $7.50 12-month target price, which is based on 10x our 2010 pro forma operating EPS estimate of $0.38, plus our 2009 projected net cash per share position of $3.82...Airvana is a leading Radio Network Controller (RNC) provider for Code Division Multiple Access (CDMA) wireless networks. The company generates roughly 95.0% of its sales from selling these product to Nortel Networks (NYSE: NT). This Nortel business was recently purchased by Ericsson (Nasdaq: ERIC)...We believe the wireless market is on the cusp of moving to the Long Term Evolution (LTE), which is a fourth generation (4G) wireless set of technologies. Nortel made the decision to develop its LTE solutions internally and thus Airvana expects to see the market for its core products dwindle in coming years. Airvana has not developed LTE-based RNC technology as a result of Nortel's decision...The company has made, in our view, an aggressive bet on the femtocell market to combat the pending decline in its core RNC business...We believe there are a number of risks associated with an investment in Airvana, including Nortel/Ericsson exposure, visibility of financial performance, 4G wireless migration, the adoption of femtocell technology and competition."
To see all the upgrades/downgrades on shares of AIRV, visit our Analyst Ratings page.
Airvana, Inc. is a provider of network infrastructure products used by wireless operators to provide mobile broadband services.
Cantor analyst says, "Pro forma revenue is based on quarterly billings, as is pro forma COGS. Pro forma results also utilize a 38.0% tax rate and exclude acquisition amortiization and stock compensation expense...We are initiating coverage on Airvana with a HOLD rating and a $7.50 12-month target price, which is based on 10x our 2010 pro forma operating EPS estimate of $0.38, plus our 2009 projected net cash per share position of $3.82...Airvana is a leading Radio Network Controller (RNC) provider for Code Division Multiple Access (CDMA) wireless networks. The company generates roughly 95.0% of its sales from selling these product to Nortel Networks (NYSE: NT). This Nortel business was recently purchased by Ericsson (Nasdaq: ERIC)...We believe the wireless market is on the cusp of moving to the Long Term Evolution (LTE), which is a fourth generation (4G) wireless set of technologies. Nortel made the decision to develop its LTE solutions internally and thus Airvana expects to see the market for its core products dwindle in coming years. Airvana has not developed LTE-based RNC technology as a result of Nortel's decision...The company has made, in our view, an aggressive bet on the femtocell market to combat the pending decline in its core RNC business...We believe there are a number of risks associated with an investment in Airvana, including Nortel/Ericsson exposure, visibility of financial performance, 4G wireless migration, the adoption of femtocell technology and competition."
To see all the upgrades/downgrades on shares of AIRV, visit our Analyst Ratings page.
Airvana, Inc. is a provider of network infrastructure products used by wireless operators to provide mobile broadband services.
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