Monday, November 06, 2006

Calls of Note Part 1

- Piper Jaffray comments on Motorola (NYSE:MOT) saying checks indicate strong North American trends, and they believe Motorola remains well-positioned to grow its dominant share during Q406.

Firm believes RAZR sales at Verizon Wireless improved during October, primarily due to the lowered price point of $50 from $100 in September. Also, they noted strong initial KRZR phone sales at Verizon. In addition, they believe Q sales improved m/m, mainly due to the lower price point of $100 from $200 in September.

According to checks, Motorola's RAZR continued to enjoy strong GSM phone sales at T-Mobile, mainly due to a price drop to $50 from $70 in September. Further, store managers indicated the $150 RAZR V3T music enabled phone and $70 tattoo RAZRs were also selling very well. While Samsung's Ultrathin platform products continued selling well, the firm believes the refreshed RAZR products led to increased sell through trends for Motorola.

In addition, RAZR continued to post strong sales at most Cingular stores. However, PEBL and SLVR sales at most T-Mobile and Cingular stores appeared flat to slightly down, mainly due to lack of attractive promotional activities for these phones.

Maintains Outpeform and $27 tgt.

Notablecalls: So the phones aren't selling unless the price is cut in half? Makes me say hmmm! Maybe this won't impact MOT this qtr, maybe it will. The stock is sitting pretty right at its 200MA. That tells me that at least SOME of this is already priced in. Think we will see some selling pressure in the very n-t and then a short covering rally. Still, I would not want to be long MOT into earnings. Would adjust my position accordingly.

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