Shares of Alcatel-Lucent fell after a UBS Investment Research analyst cut his price target on the telecommunications equipment company, citing poor performance in mobile sales, an Associated Press report said.
The entire mobile sector 'remains uncertain and challenging' going into 2008, analyst Nikos Theodosopoulos, quoted by the Associated Press report, said.
He kept his 'Neutral' rating, the report added.
And integration at the company, Alcatel's buyout of Lucent closed last December, still has a few kinks and 'cultural issues' to work through, Theodosopoulos said, noting that he expects the company to continue with its previously announced layoff of 4,000 people.
The Associated Press report also quoted Morgan Keegan analyst Simon M. Leopold as saying that news from T-Mobile International that it chose China's Huawei Technologies to replace networking equipment across Europe is a 'negative' for Alcatel-Lucent and other telecommunications companies.
The deal, Leopold said in a client note, signals 'intensifying competition' for vendors like Alcatel-Lucent and Nortel.
Leopold kept his 'Outperform' rating on Alcatel-Lucent, however.