Alvarion: Piper Bearish; Cites Weak Carrier Spend

Piper Jaffray analyst T. Michael Walkley this morning assumed coverage of Alvarion (ALVR) with an  Underweight rating and a $3 price target, well below yesterday’s closing price of $4.47.

“While we believe Alvarion is well positioned as a WiMax provider, we remain cautious on the ramp in Alvarion’s WiMax sales due to macro factors” and valuation concerns, he wrote in a research note.

Walkley believes macro concerns continue to weigh on operators, who are likely to conserve capital into the second half. “As such, we remain cautious on the ramp in overall WiMax sales for Alvarion in 2009,” he writes.

He also notes that some incumbent technologies, including EVDO and WCDMA, continue to be aggressively deployed aggressively in emerging markets, including China. “We believe these incumbent technologies have economies of scale and a diverse product portfolio for handsets which are essential for carriers to attract customers and recoup capital expenditure spent on the network upgrades,” he writes. “We believe WiMAX will remain only in niche markets and we remain cautious on ramping WiMAX sales in 2009.”

In pre-market trading, ALVR shares are unchanged.