UPDATE: Morgan Stanley Resumes Coverage On Telefonica Brasil SA On Best Market Position

In a report published Tuesday, Morgan Stanley analyst Michel Morin resumed coverage on

with an Equal-Weight rating and $22.00 price target. In the report, Morgan Stanley noted, “Vivo's mobile service revenue (MSR) growth accelerated to +6% y/y in 2Q14, from +3% in 1Q14, a solid performance given calendar and MTR headwinds.This also compares favorably to peers Claro (+2% from +4%), TIM (-1% from +1%), and Oi (stable at -5%). These results appear to confirm our view that Vivo's perceived superior network quality and postpaid segment leadership position the company to increase its share of mobile revenues as termination rates decline steeply over the next five years. Indeed,as noted in our September 12th Brazil Mobile Market Model report, we estimate that Vivo gained 220bps of share of MSR over the last 12 months.” Telefonica Brasil SA closed on Monday at $21.29.