Citigroup Thinks Comcast (CMCSA) and Time Warner Cable (TWC) Should Merge

In a research report today, Citigroup said that Comcast (Nasdaq: CMCSA) and Time Warner Cable (NYSE: TWC) should merge. Citi said there would be a number of benefits to a deal, including robust cost synergies.

Citi highlighted these seven benefits of a deal: 1) Robust cost synergies, 2) Maintains investment grade rating, 3) Counters escalating content costs, 4) Simplifies wireless strategy, 5) Limits bidding war for future cable assets, 6) Extends cost advantage over telco and DBS, 7) Counters telco-DBS M&A.

The firm raised their price target on Time Warner Cable from $35 to $45, maintaining a Buy rating.

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