Credit Suisse Upgrades Time Warner (TWX) to Outperform; Deal Has Good Chance of Being Approved
- Top 10 News for 12/2: Crude Rips on OPEC Cut; Starbucks' Schultz Steps Down; Nonfarm Payrolls Flat in Nov.
- Unemployment Rate Drops to 4.6%
- Bond yields slip on U.S. jobs data, euro steady before Italy vote
- Alibaba (BABA) Founder Jack Ma Discuss Plans to Retire; 'I Don't Want to Die at the Office'
- Starbucks Coffee (SBUX) CEO Howard Schultz to Step Down, Appointed Executive Chairman; Kevin Johnson New CEO
Get the Pulse of the Market with StreetInsider.com's Pulse Picks. Get your Free Trial here.
Credit Suisse upgraded Time Warner (NYSE: TWX) from Neutral to Outperform with a price target of $107.50, saying regulatory pessimism is overdone.
Analyst Omar Sheikh commented, "We upgrade our rating to Outperform (from Neutral), with an unchanged TP of $107.50. We think the market is being too pessimistic about the regulatory review process for the AT&T transaction, which we believe has a good chance of being approved. Even if the deal is somehow blocked, strong underlying business trends and the potential for other offers in the future are likely to limit the downside."
Sheikh sees few substantive reasons to block deal. "If the AT&T transaction is reviewed by the US Department of Justice alone, it is very hard to see how it can be blocked, given it is a vertical transaction which does not remove a competitor from any market," he said. "Even if there is an FCC review, we also argue that given (i) the Comcast/NBCU transaction was allowed in 2011, establishing a vertically intregrated content/distribution player; and (ii) strong "net neutrality" rules are now enshrined in law, which make it unlawful for ISPs to discriminate between "edge" providers; blocking AT&T/Time Warner on public interest grounds would also be very difficult to justify, in our view."
Shares of Time Warner closed at $86.42 yesterday.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- UPDATE: AT&T (T) Thinks Time Warner (TWX) Deal Has Good Chance After Talking to Trump's Team - FT
- Credit Suisse Upgrades MLP Sector to Overweight
- Jefferies Cuts Price Target on Eros Int'l (EROS) to $18 Following Multi-Year Deal
Create E-mail Alert Related CategoriesAnalyst Comments, Hot Upgrades, Mergers and Acquisitions, Rumors, Upgrades
Related EntitiesCredit Suisse
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!