UPDATE: Societe Generale Upgrades Weatherford to Hold on Tax Accounting Progress
In a report published Tuesday, Societe Generale upgraded Weatherford International Ltd. (NYSE: WFT) from Sell rating to Hold, and raised price target from $10 to $10.50.
Societe Generale noted, "a successful resolution to WFT's tax accounting problems appears to be on the cusp, and we upgrade to Hold from Sell after yesterday's steep sell-off. A wind down of the massive back office focus on tax should drive improved corporate focus on field level operations / profitability. Investor sentiment should improve with a more visible earnings outlook, and WFT's new growth strategy with a focus on returns over revenue could allow it to be viewed more comparably to larger peers. We believe that a positive resolution on the tax issue and improving operational performance will support higher WFT multiples, and we lift our P/E and EV/EBITDA assumptions to 7.5x and 4.0x, from 7.0x and 3.5x. This lifts our WFT target to $10.50, from $10."
Weatherford closed at $9.15 on Tuesday.
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