Ericsson: Merrill Downgrades, Advises Taking Profits

Ericsson (ERIC) shares are trading lower this morning after Merrill Lynch analyst Andrew Griffin cut his rating on the stock to Underperform from Outperform. He notes that the stock had rallied 25% over the last six weeks, and advises investors to take profits. Griffin notes that warnings from many players in the handset business - he lists Nokia , Research In Motion , Texas Instruments and Infineon , and you can add to that list Palm , Skyworks and RF Micro - raises the risk of Sony Ericsson pre-announcing sometime this month. Griffin adds that he expects Sony Ericsson to lose share in 2009 due to its heavy exposure in lower growth regions, in particular Europe, and a lack of presence in growth areas like smartphones and low-end handsets. He expects Sony Ericsson to operate in the red in both 2009 and 2010. Griffin’s new prices target is $8.21, down from $8.83. (The weird numbers reflects that his original targets are in Swedish krona.) ERIC today is down 18 cents, ... (link)