Deutsche Bank raised its rating on MetroPCS Communications PCS from Hold to Buy and increased its price target from $9 to $12.
Deutsche Bank commented, "Despite yesterday's massive outperformance (+37% vs. SPX +2%), we see at least 40% potential upside over the next 12 months for a few reasons. (1) Against a backdrop of low expectations, we believe that PCS's planned LTE product roll-out in 3Q/4Q could drive a sharper than anticipated return to sub and ARPU growth. (2) PCS has several potential strategic alternatives including spectrum deals and M&A (as cited by various media reports). (3) Valuation remains compelling; PCS is trading at a 30%+ discount to large cap wireless peers."
MetroPCS Communications closed at $8.59 on Thursday.
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