Lehman Brothers today downgraded Amdocs (NYSE:DOX) from Strong Buy to Market Perform.

The problem lies not with the company, but with its market, wrote analysts Claire Harrison, Coleen Kaiser and Elisabeth Jamieson. They see the Israeli company being a player in its market, but that its field will continue to suffer from "major setbacks in the foreseeable future".

The analysts also lowered their estimates for Amdocs. They see the billing and customer-care software maker ending 2002 with revenues of $1.6 billion and earnings per share of $1.12.

The following year should be slightly worse, they predict. They see 2003 revenues of $1.58 billion, and earnings dropping to 94¢ per share.

Part of the problem is a price war among peers, they note, as telecommunications companies reduce demand for CC&B systems.