JDS Uniphase Slips on Lowered Outlook

JDS Uniphase (Nasdaq: JDSU) fell 75 U.S. cents to $27.25 in morning trading Wednesday, after lowering, for the second time, sales and earnings estimates for the quarter ending March 31st.

JDS, a maker of fiber-optic components, said in a filing with the U.S. Securities and Exchange Commission that the lowered outlook “reflects continued uncertainty in carrier capital spending prospects and customer inventory adjustments, as well as a lower level of near-term sales visibility.”

For the second time this month, analysts at WR Hambrecht & Co. on Wednesday announced that they were maintaining a buy rating on the stock, according to published reports, despite trimming earnings forecasts for JDS.

“We maintain our buy recommendation, as we believe the recent decline in shares has largely discounted the near-term growth deceleration,” WR Hambrecht analyst Jim Liang reportedly wrote in a research note.

On March 2nd, WR Hambrecht issued a report maintaining a buy rating for JDS, with a 12-month price target of $45.

Shares of JDS traded as high as $153 last year, but have been hard hit in recent weeks by news that big customers, such as Cisco (Nasdaq: CSCO), are seeing lower demand for their products.

JDS said that it expects sales for the fiscal third quarter to total $925 million, with pro forma earnings of 14 cents per share. For the fourth quarter ending June 30th, the company predicted sales and pro forma earnings at or slightly above third-quarter levels.

Previously, on February 14th, the company lowered its outlook for the year, predicting sales for the quarter of $1 billion, with earnings before extraordinary items of 17 cents per share.

For the year as a whole, JDS in February projected sales of $3.9 billion and earnings of 74 cents per share. At the time, JDS made remarks similar to those in its latest announcement.

“This guidance reflects continued uncertainty in carrier capital spending prospects and customer inventory adjustments, as well as a lower level of near-term sales visibility than the company has experienced in recent periods,” JDS said in February.

On February 28th, JDS announced 3,000 layoffs, saying that the “current business environment” posed “opportunities for realignment and improved efficiency.”

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