UPDATE: Bank of America Upgrades Cincinnati Bell to Neutral, Raises PT on Potential to Monetize Wireless

In a report published Wednesday, Bank of America analyst David W. Barden upgraded the rating on

from Underperform to Neutral, and raised the price target from $3.00 to $3.50. In the report, Bank of America noted, “Wireless stocks have re-rated in the past 6 months as the demand for spectrum resources and a related wave of M&A activity has picked up considerably. Within our sum-of-the-parts analysis, we believe the increase in peer wireless multiples supports a higher valuation on CBB's wireless business. We have increased our assumed multiple to 6.5x 2014E EV/EBITDA (values the wireless business at $376m) vs. our prior 5.25x ($305m) to reflect a potential take-out valuation, as management has said that it is exploring all options for the business. This in turn drives the increase in our price objective from $3.00 to $3.50. While the potential may exist for CBB to extract greater value from the wireless business than we previously assumed, based on our estimates a ‘good case scenario' already appears to be largely priced into the stock, which supports our Neutral rating.” Cincinnati Bell closed on Tuesday at $3.18.