Canaccord Genuity Maintains a 'Hold' on Novatel (NVTL); Cutting Numbers on Soft Q1

Canaccord Genuity maintains a 'Hold' on Novatel (NASDAQ: NVTL) price target lowered from $4.00 to $2.50.

Analyst, T. Michael Walkley, said, "Novatel reported Q1/12 sales of $100.2M and pro forma LPS of $(0.14) versus our $89.3M/($0.10) estimates. Solid sales of MiFi products drove upside to our sales estimate while pricing pressure on legacy MiFi products and higher component costs led to gross margin and net income below our expectations. Q2/12 sales guidance of $92M-$104M was below our $116M estimate as management stated potential component shortages could affect supply of new LTE MiFi products. We believe Novatel could suffer from limited LTE chipset allocation for MiFi products and therefore see sustained earnings pressure in 2012...we are lowering our pro forma 2012 EPS estimate from $0.14 to $(0.24) and our 2013 estimate from $0.30 to $0.17."

For an analyst ratings summary and ratings history on Novatel click here. For more ratings news on Novatel click here.

Shares of Novatel closed at $2.81 yesterday.

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