UPDATE: Bank of America Upgrades RF Micro Devices to Buy, Reiterates $10 PT Following Merger with TriQuint Semiconductor

In a report published Monday, Bank of America analyst Vivek Arya upgraded the rating on RF Micro Devices RFMD from Neutral to Buy, and reiterated the $10.00 price target. In the report, Bank of America noted, “We upgrade RFMD to Buy with $10 PO, or ~40% upside potential from current levels, as its proposed merger with TriQuint would bring together the #3 and #4 players in the radio frequency chip (RF) market to create a powerhouse with ~35% share. RFMD's strong portfolio of power amps and switches combined with TriQuint's filters brings strong product, sales and cost synergies for 3G/4G smartphones, tablets and other connected devices. Also, ~25% exposure to high margin (55% GM, 30%+ OpM) and long life-cycle military/infrastructure adds defensiveness to the business model.” RF Micro Devices closed on Friday at $7.08.