Selling, general and administrative expenses are estimated to be approximately $121 million, research and development costs are expected to be approximately $9 million, and amortization of intangibles to be approximately $9 million. Given improvements in JBL's operations, we do believe that the stock should trade in-line with the industry median. We maintain our Hold rating on the stock and have cut our target price to $11.50, which reflects a multiple of 8.8x our 2009 estimated EPS of $1.31.

CRA International Now a Sell

We are downgrading our rating on business and legal consultancy company CRA International (CRAI) from Hold to Sell, following the release of third-quarter financial results that fell well short of Street expectations. The shortfall marks the second such disappointment in the last three quarters. As such, we anticipate that investors will demand evidence that the management has properly addressed the Boston, Massachusetts-based company's operational problems before affording a higher multiple to CRAI shares.

The shares declined 27% following the release of the disappointing third-quarter results. However, we believe that the stock may be subject to further downside risk, and we do not expect material short-term price appreciation in light of the operational challenges facing the company. While it is true that CRAI may ultimately reap some rewards from the current upheaval in the financial markets, we do not expect a significant positive impact in the near-term.

The stock is currently trading at a discount to the peer group average on a price/earnings basis. Our price target of $25 per share reflects a multiple of 15x our 2008 earnings-per-share estimate. While this multiple represents a discount to the peer group average, we feel this discount is well warranted given CRA International's poor operating performance in 2008.

Broadcom Wary of Slowdown

Broadcom (BRCM) is a fabless company, designing and marketing semiconductor components that network voice, video, and data traffic for applications in digital cable and satellite set-top boxes, cable and digital subscriber line (DSL) modems, high-speed local area networks (LANs), metropolitan area networks (MANs), long-haul networks, wireless communications, server solutions, and many more areas. The system-on-chip solutions provided by Broadcom inexpensively integrate analog, digital, and mixed signal circuitries that address the requirements of a broad clientele.

Verizon's (VZ) licensing agreement with Broadcom (as a remedy to the ITC ban) may compel Sprint-Nextel (S) to enter into a similar agreement. The royalties paid by Verizon would equate to approximately 4% of Broadcom's revenue, and the gross margin impact could be as much as a 350 basis point addition to the company's long-term GAAP gross margin target of 50%-52%.

Competition is a major cause of concern, as the company is pitted against the two chip-making giants, Intel (INTC) and Texas Instruments (TXN).