Shares of

Adtran

(ADTN) - Get Report

were falling more than 5% Tuesday as investors turned sour on the company's guidance.

The telecom-gear maker reiterated previous forecasts for the fourth quarter, but they fell below Wall Street's estimates. Adtran said it anticipates fourth-quarter earnings of 40 cents to 42 cents a share, compared to analyst estimates of 43 cents, according to Thomson First Call. Meanwhile, the company said it predicts revenue of $104 million to $107 million vs. forecasts for $108 million.

Adtran shares rallied sharply at the beginning of the month when the company raised its third-quarter outlook, suggesting demand for telecom gear was picking up. After the close Monday, Adtran reported a third-quarter profit of 42 cents a share, up from 9 cents a share a year earlier. The company said revenue increased to $106.2 million from $88.2 million in the year-ago period.

Mike Percica, an analyst at Brean Murray, believes Adtran is being conservative with its fourth-quarter estimates. "I believe we will see an uptick in December," he said. "But if their guidance is correct, that would make investors nervous." The stock was lately down $3.95, or 5.4%, at $69.55.

Adtran is one of the first telecom companies to provide fourth-quarter expectations following

Juniper's

(JNPR) - Get Report

bullish outlook last week.