Ahead Of The Bell: Analyst Upbeat On Adtran Sales

NEW YORK (AP) — Adtran Inc. should see improving sales in a new partnership with Ericsson Telephone Co., a Morgan Keegan analyst said as he upgraded shares to "Outperform" from "Market Perform."

Analyst Simon Leopold told investors in a note late Thursday he expects Ericsson to use Adtran's networking gear in new fiber-optic projects. He noted Ericsson's new contract to provide equipment for upgrades to AT&T Inc.'s network.

Leopold said Wall Street has missed the sales opportunity in projecting Adtran's quarterly results. He projects the AT&T upgrades could be worth $200 million to $500 million over the next few years.

He now expects Adtran will generate revenue of $551 million in 2010, up from a previous estimate of $528 million. On average, analysts expect $531 million, according to Thomson Reuters.

Leopold also pushed up his earnings forecast, now anticipating $1.43 per share, up from $1.30 and above analysts' average forecast of $1.32.