Needham & Company Downgrades ADTRAN (ADTN) to Hold

Needham & Company downgraded ADTRAN (NASDAQ: ADTN) from Buy to Hold on loss of AT&T and Euro headwinds.

Analyst commented, "Our positive stance on ADTN, which was based on a presumed broadband rollout with AT&T, has been proven wrong with the recent "cancellation" of this major program. Combined w/sharp Euro headwinds and continued struggles for the company's historically steadily-growing Internetworking business, this leads to a likely down revenue year in 2015 and uncertain, but we think modest, growth prospects in 2016 and beyond. While acknowledging investor capitulation off the AT&T loss may have driven the stock to a near-term low, we downgrade the shares to Hold from Buy on the lack of catalysts and a valuation that, while not expensive, appears fair given our current growth outlook."

The firm is sharply reducing 2015/2016 estimates to reflect the AT&T loss and Euro headwinds. 2015 estimates go to $601MM/$0.61 from $662MM/$0.97 NG EPS. 2016 estimates go to $624MM/$0.90 from $701MM and $1.21.

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

Shares of ADTRAN closed at $16.61 yesterday.

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