Bank of America Likes Burger King, Miller Tabak Sees Deal as Mutually Beneficial

After today's announcement of the deal between Burger King

and Tim Horton's

, several firms provided their take. Bank of America / Merrill Lynch upped their rating from Underperform to Buy, also increasing the Price Target from 23 to 38. They see significant upside for potentially new company, with the Tim Horton's brand now expanding internationally through Burger King's international master franchise agreements. They go on to say "Burger King has an extensive and rapidly growing international presence with more than 6,400 restaurants growing at a double digit percentage pace while Tim Hortons has a modest stake outside of North America." Miller Tabak commented below: "Over time, we view a potential THI-BKW merger as benefiting both sides: THI would gain access to a broader array of potential franchise partners in the U.S. (particularly the 564-unit Carrol's Restaurant Group [TAST, $7.04, Not Rated], which is BKW's largest U.S. franchise partner), while BKW would gain a company with historically strong operations, access to a competitive coffee product that potentially could be added to more than 7,400 restaurants across North America, and a growing brand in the U.S. in its own right (i.e., THI's U.S. top-line growth expanded 15.3% in 2Q14, helped by the combination of strong unit expansion and same-restaurant sales growth of 5.9%)." Share sof both companies are trarding appreciably higher, with BKW and THI both up slightly greater than 20 percent.