Updated from 8:50 a.m. ET.

JNI

( JNIC) warned last night, sending shivers through not only the spines of its shareholders, but through those of

Sun Microsystems

(SUNW) - Get Report

as well, saying that weakness in Sun's server market caused it to revise first-quarter forecasts. You see, JNI makes adapters for computer storage networks. If you think of Sun's servers as tin cans, then JNI makes the knots that bind the string to those cans.

As a result of the warning, Wall Street analysts look another look at Sun's bottom and top line. Some didn't like what they saw, like

Bear Stearns'

Andrew Neff. The analyst trimmed his 2001 earnings forecast on Sun for the fourth time since January, dropping it to 40 cents a share from 50 cents a share -- the current consensus estimate. "Given continued weakness in enterprise markets, particularly in the high end and (given) deteriorating economic conditions, primarily in the U.S. though clearly spreading to international markets -- we are again lowering estimates," he wrote.

Neff didn't exactly have great things to say about JNI, either. He also dropped 2001 estimates on the company, lowering it to 3 cents a share from 6 cents a share, coming in line with last night's revised guidance. Low visibility was one reason for the revision, but Neff said that the company needs to rely on more than Sun to get ahead. "While JNI has built a good competitive position in the Sun Solaris platform, it will have to expand beyond this base and get design wins with other server original equipment manufacturers and on other operating systems," he wrote.

Lehman Brothers

analyst George Elling, who expects Sun to make 48 cents a share in fiscal 2001, took JNI's weakness as yet another sign that Sun will probably have to revise its numbers again, with the economic climate so poor and a price war on the horizon. He did not, however, alter his strong buy rating on the stock or any of his profit estimates.

"Clearly, Sun is facing difficult comparisons, and in addition, visibility and momentum are lacking. Our Sun sales contacts have indicated the company is engaged in very aggressive pricing, which creates the possibility for further margin erosion beyond our recently pared estimates," he wrote. "In light of the recent lack of visibility, we believe further estimate cuts are possible."

Merrill Lynch's

Thomas Kraemer also said that Sun's risk of a preannouncement before it releases third-quarter earnings after the trading day on April 19.

If you've ever signed the

UPS

guy's little computer notebook, then you've touched one of

Symbol Technologies'

( SBL) many products. The company manufactures and sells barcode scanners and portable computer devices that allow people to manage data and inventory while wearing brown tube socks in the middle of suburbia.

Unfortunately, with the current economic climate cooling, Lehman Brothers analyst Jeff Kessler thinks the company's sales will fall, simply because its customer base is facing such a tough time meeting earnings growth targets. Kessler downgraded the company to buy from strong buy, dropped his 2001 earnings estimate to $1.25 from $1.32 a share and lowered his price target to $56 from $63. Wall Street, on average, expects the company to make $1.31 a share. Yesterday, Symbol closed at $39.10.

"Our fears surrounding negative preannouncements, from logistic providers like UPS and

FedEx

(FDX) - Get Report

to wireless device manufacturers like

Palm

( PALM), cause us to question how long Symbol can buck the trends surrounding its markets," he wrote. "Our last checks with the company (several weeks ago) indicated that order rates were still holding up. However, our visibility on Symbol's revenue base gets cloudier as several of its end markets continue to deteriorate."

Although Kessler said Symbol was the dominant company in the barcode market and could very well meet his old earnings estimate for 2001, he felt the company's stock could fall to $30, just because the economy is that bad.

W.R. Hambrecht

initiated coverage on Web-services provider

Digex

(DIGX)

, which hosts Web sites and tracks traffic for clients like

J. Crew

and

Nissan

. The company was started with a buy rating with a $17 price target. "Although the company is expected to remain unprofitable for the foreseeable future, we believe Digex is in a power position over the long-term as Internet infrastructure outsourcing proliferates among corporations across the globe," wrote analyst Greg Gore.

Also, Hambrecht analyst Peter Friedland started

Comverse Technologies

( CMVT) with a buy rating and a $75 price target. Although the company already trades higher than many of its peers, with a price-to-earnings ratio of 41.3 as of yesterday's close, Friedland said the company's rock-solid management was worth the price. "Comverse provides investors with exposure to the high-growth wireless Internet infrastructure software market, with the protection of a steady recurring revenue stream from the company's legacy business," he wrote. That legacy business? Comverse provides the service to phone companies that allow them to offer call answering and voice mail.

Goldman Sachs

analyst Howard Shapiro initiated coverage on

Dime

(DME)

with a market outperform rating and a price target of $37. And outperform it has. Since August 1, the company has gained 92%. Shapiro said he likes the company's new direction.

"We believe that Dime will outperform as management refocuses on leveraging the company's well-respected franchise and accelerates the bank's operating transformation from a thrift to a commercial banking model," he wrote.

Moody's

(MCO) - Get Report

the credit rating people, received a rating of its own from Goldman analyst Chitra M. Sundaram. He started the company with the relatively underwhelming market perform rating because he feels the company is valued fairly at this level. Plus, Sundaram said that uncertain fundamentals in the U.S. could cause Moody's stock to tread water.

Credit Suisse First Boston

analyst Todd Raker started

Inktomi

(INKT)

, the Web-software company that makes products to unclog Web traffic, with a hold rating. Simply put, he feels that the company's near-term picture is so uncertain that a higher rating was unwarranted.

"We expect the rest of 2001 to be challenging for Inktomi's network infrastructure product line, as market conditions increase the difficulty of closing large deals with new customers," he wrote.

Analyst actions

Downgrades

Belo

(BLC)

: DOWN to hold from buy at Credit Suisse First Boston.

Computer Access Technology

(CATZ)

: DOWN to long-term attractive from buy at

Robertson Stephens

.

Initiations

Hibernia

( HIB): NEW neutral at

Salomon Smith Barney

; price target: $14.

Marshall & Ilsley

( MI): NEW market outperform at Salomon Smith Barney; price target: $55.

Wilmington Trust

( WL): NEW market outperform at Salomon Smith Barney; price target: $65.