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Wireless broadband supplier



watched its value sliced in half Thursday after results reported a day earlier prompted brokers to downgrade its stock.

Netro was trading down $24.75, or 54%, to $21.50.

The company, which provides wireless access systems for broadband communications, reported that it broke even on revenue of $20.5 million for the third quarter. That compares to a loss of 17 cents a share from the same quarter a year ago and analysts' expectations of a loss of 3 cents a share, according to

First Call/Thomson Financial


Michael Ching, an analyst at

Merrill Lynch

, noted that Netro's revenue for the quarter fell slightly below his estimate of $21 million. He also noted that its gross profit margin of 27% was down sequentially and below his estimate of 32%. In addition, the company's profit margins haven't met expectations for the last four quarters.

Analyst Tim Luke, of

Lehman Brothers

, also noted the concerns about profit margins. Luke downgraded the stock to outperform from buy. (Both Lehman and Merrill have done underwriting for Netro).

"Without significant outperformance on quarterly numbers, Netro's premium valuation will be difficult to maintain," wrote Ching, who downgraded the stock to long-term neutral from near-term accumulate.

The Merrill report noted that Netro was having some difficulties in meeting manufacturing demands. Both Merrill and Lehman reported that



, responsible for 85% of Netro's revenue, recently signed an agreement with a privately held maker of wireless transmitters.