UTSI got another downgrade today as reported by briefing.com. This one is pretty vicious:

“9:20AM UTSI estimates still too aggressive — WR Hambrecht 18.06: WR Hambrecht believes UTStarcom (UTSI) mgmt’s 2005 guidance and Street estimates are still too aggressive. The co’s most critical near-term challenge will be to enhance the margin profile of the Audiovox business. However, the firm now expects that the co’s ‘05 performance may be influenced by the positive effects of new higher margin infrastructure revenue counterbalanced by the unfavorable impacts of price erosion in its core PAS business. The firm maintains a Hold rating and $12 target, and views the recent run as a favorable profit-taking opportunity.”

A quick look at the list of analyst action shows that these seers have been slamming, jamming, and ramming UTSI for the last few weeks. In fact, since May, analysts have been merrily riding UTSI down into new 52-week lows. Only two analysts have dared to bother upgrading the stock in this time, and these were just reversals of earlier downgrades.

So why mention this fallen star? Well, I am yet again intrigued by the story the insiders are telling us. For some reason, a lot of the top executives in the company have dropped over $48 MILLION on their own stock. Last time I checked, that’s a lot of money! Again, it is up to you to do the rest of your due diligence (for example, UTSI by and large still looks like an ugly, broken-down stock), but MY radar has picked up a potentially explosive divergence of opinion at work here…