Merrill Lynch analyst Jessica Reif Cohen boosted her price target on shares of cable giant Comcast Corp. by $10 to $57 on Friday, saying this provides upside potential of 33% from current trading levels. "We are revising our target multiple to reflect accelerated growth, primarily attributable to the rollout of business services," which Comcast chairman and CEO Brian Roberts detailed last week, the analyst said in a report. She now projects compound annual growth in Comcast's operating cash flow of 13% for the 2007-11 frame, up from her previous projection of 11%. "There is still upside to these estimates," she said.
Shares of video rental players Blockbuster Inc. and Netflix Inc. went opposing ways Friday even though JPMorgan downgraded both stocks from "overweight" to "neutral" at week's end. The firm cited weaker-than-expected in-store rental trends at Blockbuster and the risk that Netflix could miss subscriber targets because of warm weather in the Northeast U.S. and increased online competition from Blockbuster. Netflix fell 6.3% to $22.71, and Blockbuster rose 4.4% to $6.43.
Clear Channel low
Bear Stearns analyst Victor Miller on Friday reaffirmed his opinion that a bid to take radio giant Clear Channel Communications private is too low, citing recent stock trends. The $37.60 buyout bid meant that Clear Channel "accepted (an offer) below market multiples for businesses that were operationally bottoming," he said. The day before the deal was announced, Clear Channel traded at $32.35. Miller estimates that its recently spun off Clear Channel Outdoor Holdings "should have added $5.06 to Clear Channel's stock" since then. As a result, the buyout price tag carries "nearly no premium" at 0.5%, he said.