UPDATE: Bank of America Initiates Coverage on Atmel on Tale of Transformation

In a report published Friday, Bank of America analyst Vivek Arya initiated coverage on

with a Buy rating and $11.00 price target. In the report, Bank of America noted, “We initiate Atmel (ATML) with a Buy and $11 price objective, or 38% upside potential. Atmel is a mid-sized chip vendor in the $16bn microcontroller (MCU) industry that is on the verge of re-accelerating in automotive, smart energy, touch and connected devices (internet-of-things, IoT) markets. The Street is concerned about Atmel's past missteps, including share losses in mobile touch, a high cost structure and a recent fire in its main fab. But restructuring actions, rising demand and move to an asset-light model could quadruple Atmel's EPS toward $1/sh in the next 2-3 years, in our view. "Atmel also benefits from semi industry consolidation with its $3.5bn market cap, clean balance sheet and solid MCU franchise.” Atmel closed on Thursday at $7.99.