UPDATE: Wedbush Securities Downgrades Acme Packet to Neutral

Wedbush Securities has published a research report on Acme Packet

and has downgraded the company from Outperform to Neutral based on several factors listed below. In the report, Wedbush writes, "Our downgrade is based upon on the following factors: 1) In our view, there remains risk to estimates going forward. 2) Large win with AT&T appears unlikely to offset broad-based weakness in the overall business. 3) We see significant evidence that growth in the session border controller market is slowing beyond our expectations due to uncertainty in the service provider business. 4) Finally, management's credibility has been damaged given two consecutive quarters of missing guidance. We upgraded the stock on 10/05 after a 50% decline in the stock due to our belief that valuation was attractive and that a large win with AT&T would add significantly to growth to an otherwise healthy business. We were clearly overly optimistic on the SP business and given continued uncertainty in capex spending, we think risk to estimates remains. We advise investors to avoid the stock until clear signs of capex investment reemerge." Wedbush has also lowered the price target from $45 to $26 on Acme Packet, which is currently trading down $6.29 from yesterday's $31.81 closing price.