We upgrade our rating to Buy for Alvarion Ltd (ALVR), a pure-play wireless solutions provider. This follows a series of impressive contract awards to deploy several large-scale wireless systems. The value of one of these contracts was the largest ever attained by the company.Alvarion has more than 250 WiMAX deployments in diversified geographic regions.  According to our assessment, higher bandwidth requirements and an increasing percentage of Alvarion's overall business directed to WiMAX offerings are expected to drive revenue higher in future reporting periods. Furthermore, the company maintains a strong balance sheet and a respectable book-to-bill ratio.The U.S. government stimulus plan for rural broadband expansion is providing further business prospects for Alvarion. On June 17, the company received a five year contract from Open Range Communications Inc, a U.S. wireless operator. The total contract size is estimated at more than $100 million. This ...

We currently rate shares of AstraZeneca (AZN) a Hold with a $47 price target. The company is facing a number of challenges as it enters 2009, most notably generic competition to Toprol-XL, Nexium, Casodex and Pulmicort.The just-announced increase to the cost-cutting program will aid EPS in the near-term, but we do not believe this will be enough to compensate for continued revenue deterioration beyond 2010. Atacand and Arimidex will both be subject to generic competition in 2010, then Seroquel and Symbicort lose U.S. patent protection in 2011 and 2012, respectively. This puts significantly more pressure on the company to commercialize its late-stage pipeline.The MedImmune acquisition significantly beefs up the company's pipeline, which should aid in this effort through its sizeable biologics platform. We expect management to continue to look for additional licensing and outsourcing opportunities in order to reduce operating leverage and ...

We are initiating coverage of DepoMed (DEPO) with a Buy rating and $5 price target. We are excited about the potential for Serada, and enhanced formulation of gabapentin that utilizes the company's proprietary AcuForm technology, for the treatment of hot flashes / vasomotor symptoms (VMS) in menopausal women.Serada is currently in two phase III trials with data expected in the fourth quarter of 2009. Gabapentin is a molecule that has been well studied in hot flashes / VMS, and meta analysis shows it is the superior non-HRT efficacy option out there. Unfortunately, the dosing requirements and side-effect profile of the drug dramatically limits prescriptions in this market.With Serada, DepoMed is a significant opportunity in our view. We see the drug as a potential $500 million or more opportunity.DepoMed is also developing its AcuForm-enhanced gabapentin molecule for the treatment of neuropathic ...

We currently rate shares of Wyeth, Inc. (WYE) a Hold with a $49 price target. Our target assumes Pfizer's (PFE) shares trade up near $16.00 (currently $14.85) by the expected close date in the third or fourth quarter. At an exchange ratio of 0.985 and combined with the $33 cash per Wyeth share, this equates to roughly $49 per share.Revenue in 2008 grew 2% and was up 1% excluding the benefit from foreign exchange. EPS was flat from 2007 on lower interest income and a higher tax rate, partially offset by lower SG&A spend. Revenue in the first quarter 2009 was lower than our forecast. This was largely due to a stronger-than-expected impact from foreign exchange, lower contribution from Alliance revenue (as a result of softer U.S. sales of Enbrel) and weaker-than-expected international sales of Effexor.Global economic weakness also ...

We continue to believe the shares of Bristol-Myers Squibb Company (BMY) are attractive at their current price based on valuation, strong expected EPS growth and progress in reinvesting in higher growth opportunities. The recently announced $1 billion extension in cost cuts in 2012-2013 and extension of the Abilify agreement with Otsuka are the latest examples that management is taking meaningful steps to prepare for the loss of exclusivity of Plavix.Management's 2009 EPS guidance of $1.85 - $2.00 implies growth of between 6% and 15%. Revenue is expected to grow in the low-single digits, which includes a significant foreign exchange headwind. Reaffirmed was guidance of EPS growing at a CAGR [compound annual growth rate] of at least 15% from 2007 through 2010.We expect earnings growth to remain very strong through 2011 from a combination of mid-to-high single digit sales growth and operating margin ...

We reaffirm our Hold recommendation on Bell Canada (BCE) based on the tepid operating results. The company reported limited revenue improvement and lower wireless net subscriber additions. Additionally, business momentum for video and broadband Internet segments was more than offset by sustained declines in traditional voice wireline business.BCE is increasingly exposed to price competition as evident by the persistent decline in wireless revenue per customer. Moving forward, BCE faces a greater degree of risk as it is exposed to an intensely competitive environment due to the entry of additional wireless carriers. We also anticipate that operating performance through 2009 will be negatively affected by a weak Canadian economy.The company lost nearly 40% of its market valuation since the setback associated with cancellation of the company's privatization initiative. Recent efforts to maximize shareholder returns in the form of dividend and share repurchases could ...

We maintain our Buy recommendation with a higher valuation target for Linktone (LTON), a leading provider of wireless value-added services (WVAS) in China. The company's market capitalization is currently valued below net cash levels and down nearly 25% from its 52-week high. The company's current market-cap of $96 million is below the company's net cash position of $101 million.We believe market opportunities for the company remain attractive with launches of 3G wireless services together with mobile television and flash media products/services in China. An expansion drive to Indonesia is also expected to foster long-term growth for the company.Continued sales channel initiatives together with new content offerings are reinforcing Linktone's position as a major player in the Chinese WVAS market. We consider this juncture as an attractive opportunity for investment consideration taking into account the strong balance sheet and the company's established market position with ...

We are scratching our heads to justify the impressive recent gains made by land drillers such as Nabors (NBR) and Patterson-UTI (PTEN). We are of the view that these gains lack fundamental support and remain unsustainable.Shares of land drillers have been star performers lately. In the last 12 weeks, land drillers are up an average 41%, compared to a little over-12% gain for the S&P 500. During the same time period, the deepwater offshore drillers gained roughly 25%, while the large-cap oilfield service companies, such as Schlumberger (SLB) and Baker Hughes (BHI) went up by about 32%. Year-to-date, the land drillers are up 31%, while the deepwater offshore and the oilfield service groups are up 56% and 53%, respectively.Oilfield service activities outside the U.S. are largely centered on looking for, developing and maintaining oil production. Offshore drilling, particularly the deepwater end ...

We upgrade our rating to Buy for ADC Telecommunications (ADCT), a leading telecom network infrastructure and connectivity solutions provider. In addition to reporting second quarter fiscal 2009 financial results (ending May 1) well above our expectations, ADCT is likely to improve operating performance as large telecom carriers in the U.S. increase spending for fiber-based networks.Massive deployment in China for home-grown 3G networking technology and backhaul provides high-growth revenue-generating opportunities for ADCT. Furthermore, management initiated restructuring activities, including headcount reductions, improving the company's earnings power and adding liquidity to its balance sheet. The current valuation level, at a discount of approximately 50% from the 52-week high range, is considered more favorable from a longer-term investment perspective.During the first half of fiscal 2009, ADCT secured contracts from approximately 15 new enterprise clients. Cable TV companies are also emerging as major business prospects as they improve broadband ...

We continue to hear bad news about US commercial real estate. But Europe also is also going through a major CRE correction after a boom earlier this decade. The declines in leasing and transaction volumes are in many cases worse than in the US.Jones Lang LaSalle (JLL) tracks many large European markets, and the current trends are dismal. According to JLL, overall transaction volumes in Europe dropped 54% in 2008 vs. 2007. We don't yet have 2009 numbers, but volumes will continue to drop this year due in part to difficulty financing large projects and the lack of buyers.Many buyers are waiting for prices to come down to reflect new economic realities, and sellers are reluctant to sell at discounted prices.JLL's latest European Office analysis from 1Q09 shows a major downward trend in office fundamentals throughout Europe and Russia. Office leasing is ...