UPDATE: Bank of America Reiterates Neutral Rating, Raises PT on Spreadtrum Communications on Raised 2013/14E EPS

In a report published Wednesday, Bank of America reiterated its Neutral rating on Spreadtrum Communications SPRD, and slightly raised its price target from $17.83 to $18.18. Bank of America noted, “SPRD should generate strong unit growth from (1) China/EM featurephone users upgrading to low-cost smartphones, (2) China Mobile's push of TDSCDMA smartphones needed to drive data ARPU and avoid losing customers to CU (WCDMA network). We see ASP/margin headwinds from (1) 2G ASP pressures persisting, (2) limited mix/ASP improvement than MTK due to SPRD's low-end positioning in smartphones, and (3) the high opex needed to enrichen is product mix (WCDMA, LTE, and CPU/GPU).” Spreadtrum Communications closed on Tuesday at $15.71.