UPDATE: Wedbush Cuts Target on AsiaInfo-Linkage to $12.50
Wedbush lowers its rating on Neutral-rated AsiaInfo-Linkage (NASDAQ: ASIA) to $12.50 from $13 on lower margins that impacted Q4 results and Q1 guidance.
Wedbush says, "Q4 EPS and Q1 guidance were below expectations, driven by increased compensation costs leading to lower margins, which was the basis for our recent downgrade. While encouraged by improved cash collection, domestic subscriber growth, and expansion internationally and into the cable market, we remain concerned over wage inflation and impact to margins. While the company did not offer incremental color on the CITIC acquisition offer, we would not expect a significant premium from current levels, if any.
ASIA closed at $11.76 a share on Monday.
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