Jefferies Cuts Price Target on Sierra Wireless (SWIR), Weak Q1 Results and Q2 Guidance

Jefferies is maintaining its Hold rating on shares of Sierra Wireless (NASDAQ: SWIR), but is lowering its price target by $1 to $11 on weak Q1 results and Q2 guidance.

The company missed the Street's and firms expectations for Q1 due to lower than expected component cost reductions and higher warranty costs. EPS for the quarter was a loss of $0.08 while revenue came in at $144 million.

SWIR released its Q2 guidance with an EPS range of ($0.12)-($0.07) and revenue expected to fall between $140-$145 million. As a result the firm lowered its Q2 estimate from ($0.02) to ($0.08). The Streets current Q2 revenue expectation is $157 million. The firm notes that the $13M revenue shortfall versus consensus reflects, $8 million is from the business through Clearwire going to zero as they close their retail stores, $2 million due to Japan component issues, and the rest due to sell-in for AT&T's LTE launch not occurring until Q3.

Jefferies is lowering its FY11 and FY12 EPS estimates from $0.61 and $1.09 to $0.56 and $1.03.

For more ratings news on Sierra Wireless click here and for the rating history of Sierra Wireless click here.

Shares of Sierra Wireless closed at $10.95 yesterday.

---

Serious News for Serious Traders! Try StreetInsider.com Premium Free!

---

You May Also Be Interested In

• Kingsoft Cloud (KC) PT Raised to $17.70 at Jefferies
• BofA Securities Upgrades Moderna (MRNA) to Neutral
• Target (TGT) PT Raised to $185 at DA Davidson