Credit Suisse has cut EPS estimates for both Nokia (NOK) and Motorola (MOT), citing lower than expected demand for handsets, particularly in Europe and China:
Based on comments from SEMC Brightpoint and TI we believe that handset volumes are tracking below normal seasonality due to weakness in W. Europe and China, and hence we estimate industry volumes for Q208 to rise by only 1% qoq to 300mn units (+11% yoy).
And more concerns that Nokia is getting its clock cleaned by Apple (AAPL) and Research in Motion (RIMM) in smartphones:
Our concerns about Nokia due to increasing competition in the smartphone area (especially in H208) remain. Given this and our view that 2009 consensus EPS remains 15% too high, we retain our Neutral rating despite current valuation.
Motorola’s revenue estimate drops 3% to $7 billion. EPS remains unchanged and rating stays at Underperform. Nokia’s revenue and EPS estimates fall to Eu12.4 billion and Eu0.36 respectively and rating remains Neutral.