UPDATE: Oppenheimer Upgrades Level 3 Communications (LVLT) to Outperform

Oppenheimer upgraded Level 3 Communications (NYSE: LVLT) from Perform to Outperform with a price target of $60. Analyst Timothy Horan thinks a deal with CenturyLink (NYSE: CTL) would be attractive.

"LVLT has restructured itself in the last few years and now has operational/financial flexibility on FCF, and we see accelerating growth in 2017. We also view a possible merger of CTL/LVLT (reported by The WSJ) as a powerful combination/see synergies between $1B and $2B and FCF accretion over 30% in the next three years. We believe CTL will be the surviving company and see LVLT shareholders receiving a premium but also sharing in synergies and value creation. We recognize the downside risk of a deal not materializing, but believe LVLT's FCF profile/flexibility supports a $60/share valuation," said Horan.

For an analyst ratings summary and ratings history on Level 3 Communications click here. For more ratings news on Level 3 Communications click here.

Shares of Level 3 Communications closed at $51.87 yesterday.

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