Editor's Note: This column first appeared in The Tech Edge, a proprietary newsletter, on Tuesday, June 10. For more information on The Tech Edge, click here .

Wireless investors may have gotten their signals crossed Tuesday, as Nokia's ( NOK) better-than-expected gear-sales projection pumped up stock in arch rival Ericsson ( ERICY ADR).

Owing to lumpy revenues from large network infrastructure contracts, Nokia forecast a mere 5% decline in second-quarter gear sales. Analysts had expected a decline on the order of 10% or more. Ericsson fans, sensing a thaw, quickly sent the stock up $1, or 10%, to $11.68 Tuesday.

But as Nokia explained to some investors Tuesday, and will no doubt discuss at length during Wednesday's analysts session in Helsinki, a big chunk of networking revenue is expected to get booked this quarter. That's to say, this is not the start of a trend, but merely fickle timing.

But hey, who can blame Ericsson investors for jumping to bullish conclusions? It's been a long, painful turnaround process for the Swedish gearmaker.

Still, there are a couple points to consider. Phone companies continue to manage costs by putting off spending, and there's been no sign that trend has stopped. On top of that, SARS has helped drag business down at peers Motorola ( MOT) and Nokia, both of which have lowered their sales and earnings targets.

We haven't heard much from Ericsson since its April earnings call, but with the impact from SARS and the weakening U.S. dollar, it's difficult to see how Ericsson can avoid following in Motorola and Nokia's footsteps.

One thing seems likely: Now that Ericsson has exceeded the $10-plus price target of the leading research shops like Lehman Brothers, some downgrades may be forthcoming. Downgrades for excessive valuation have been big with Lehman and UBS.

Combine the weak industry with a weak currency and a SARS-weakened Asia and you can certainly start to see fewer reasons to root for a stock.

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