Barclays Maintains an 'Overweight' on Liberty Global (LBTYA); Leverage Doesn't Mean Refi Risk
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Price: $10.65 +0.09%
Rating Summary:
10 Buy, 10 Hold, 1 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
Rating Summary:
10 Buy, 10 Hold, 1 Sell
Rating Trend: = Flat
Today's Overall Ratings:
Up: 8 | Down: 5 | New: 26
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Barclays maintains an 'Overweight' on Liberty Global (NASDAQ: LBTYA) price target of $48.00.
Barclays analyst says, "Stress Test of Capital Structure Shows Company Could Weather a Two-Year Capital Market Freeze and Continue Buybacks. LGI is relatively levered, at ~4x, which we believe lowers the company's cost of capital and increases returns to equity holders, particularly given the minimal tax leakage. The company's efforts to push out maturity dates mean that this leverage is compatible with little need to access the capital markets for the foreseeable future. While we'd expect LGI to continue to refinance debt on a rolling basis, our analysis shows that the company wouldn't need any incremental borrowing at all except to fund the buyback program." (Barclays lowers FY11 EPS esitmate from $1.44 to -0.01, but raises FY12 from $1.22 to $1.47)
For more ratings news on Liberty Global click here and for the rating history of Liberty Global click here.
Shares of Liberty Global closed at $38.88 yesterday.
Barclays analyst says, "Stress Test of Capital Structure Shows Company Could Weather a Two-Year Capital Market Freeze and Continue Buybacks. LGI is relatively levered, at ~4x, which we believe lowers the company's cost of capital and increases returns to equity holders, particularly given the minimal tax leakage. The company's efforts to push out maturity dates mean that this leverage is compatible with little need to access the capital markets for the foreseeable future. While we'd expect LGI to continue to refinance debt on a rolling basis, our analysis shows that the company wouldn't need any incremental borrowing at all except to fund the buyback program." (Barclays lowers FY11 EPS esitmate from $1.44 to -0.01, but raises FY12 from $1.22 to $1.47)
For more ratings news on Liberty Global click here and for the rating history of Liberty Global click here.
Shares of Liberty Global closed at $38.88 yesterday.
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