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UPDATE: Deutsche Bank Downgrades MetroPCS Communications to Hold; Competitive Bids Unlikely

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Deutsche Bank reduced its rating on MetroPCS Communications (NYSE: PCS) from Buy to Hold and lowered its price target from $15 to $11 as it believes no additional bids will compete with T-Mobile to take over the company.

Deutsche Bank commented, "Our more cautious view is based on a belief that PCS is unlikely to accept a competitive bid from another national wireless carrier at a price superior to current trading levels. We are therefore valuing the company with a base case that it completes its planned merger with T-Mobile (TMUS). While we believe that the combined NewCo can achieve its synergy objectives, we nonetheless see minimal, if any, EBITDA growth during the next 3-5 years (below guidance) due to ongoing struggles at TMUS. We therefore expect valuation to remain compressed and move to the sidelines until visibility improves."

MetroPCS Communications closed at $10.59 on Friday.

Posted-In: Deutsche BankAnalyst Color Downgrades Pre-Market Outlook Analyst Ratings

 

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