Kaufman Cuts Price Target on ADTRAN (ADTN) Following Q3 Results & Q4 Guidance

Kaufman Bros. is reiterating its Buy rating on shares of ADTRAN (NASDAQ: ADTN) and is lowering its price target from $45 to $42 following the release of its Q3 earnings.

The company slightly topped the firm's expectations for the quarter with $192.2 million in revenue and EPS of $0.59. The beat in revenues helped makeup for the miss in gross margins. Gross margins were below expectations due to selling more of its products with higher costs.

Management's Q4 guidance calls for a 8-10 percent decrease in revenues quarter over quarter. The firm notes that the decline is due to customers rationalizing their inventories of some products.

To go inline with the company's new guidance and market conditions, Kaufman Bros. is reducing its Q4 EPS estimate from $0.58 to $0.50 and its 2012 estimate from $2.48 to $2.42.

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

Shares of ADTRAN closed at $29.56 yesterday.

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