FBR Capital Upgrades Time Warner (TWX) to Outperform; Merger Could Avoid FCC Review
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FBR Capital upgraded Time Warner (NYSE: TWX) from Market Perform to Outperform with a price target of $104.00, saying they see a road to avoiding FCC review of the merger.
Analyst Barton Crockett commented, "Having checked with various sources, we conclude that there is a credible road for Time Warner (TWX) to avoid transferring its FCC licenses to AT&T, and thus avoid FCC review of the proposed merger. We believe this would substantially improve prospects for approval, prompting us to raise our rating on TWX to Outperform and our one-year price target to $104, within $3.50 of the headline offer price at the time of the announcement."
The analyst said TWX describes its FCC licenses as "immaterial" and could just give the FCC licenses up. Avoiding FCC review vastly improves prospects for approval, he said.
Shares of Time Warner closed at $87.47 yesterday.
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