Wells Fargo Upgrades Watson Pharmaceuticals (WPI) to Outperform; Actavis Acquisition Adds Growth Prospects

Wells Fargo upgraded Watson Pharmaceuticals (NYSE: WPI) from Market Perform to Outperform, raising price target range from $75-79 to $84-90.

Analyst, Michael Tong, said, "We have had a positive outlook on WPI's proposed Actavis acquisition. However, we were concerned about lofty 2013 cash EPS expectation (about $8) for Newco, and the share price immediately following the Actavis announcement left very little margin for error in our view. Upon further analysis, we are now more comfortable with Newco's ability to approach the EPS expectation. With WPI shares having pulled back since then, we think the reward/risk profile has turned sufficiently favorable to warrant an upgrade."

Tong raises FY13 EPS (standalone) estimate from $6.05 to $6.22...believe Newco should be able to approach the $8 EPS expectation in 2013.

For an analyst ratings summary and ratings history on Watson Pharmaceuticals click here. For more ratings news on Watson Pharmaceuticals click here.

Shares of Watson Pharmaceuticals closed at $70.71 yesterday.

---

Serious News for Serious Traders! Try StreetInsider.com Premium Free!

---

You May Also Be Interested In

• Northern Oil and Gas (NOG) PT Raised to $55 at Stifel
• Morgan Stanley Double Downgrades AU Optronics (2409:TT) (AUO) to Underweight
• Jefferies Upgrades Medpace (MEDP) to Buy, 'Big Margin Improvements'