BlackBerry employees prepare an event in London, England, on Jan. 30, 2013.The Associated Press
Inside the Market's roundup of some of today's key analyst actions. This file will be updated during the trading day. For breaking analyst actions prior to market open every day, read our Before the Bell morning report.
RBC Dominion Securities analyst Mark Sue is taking a sunnier view on BlackBerry Ltd., upgrading his rating today to "sector perform" and significantly boosting his price target on encouraging signs of balance sheet improvement.
His target on BlackBerry is now $10 (U.S.), up from $6, suggesting some modest upside for the stock price, which closed at $8.72 (U.S.) on Thursday.
Mr. Sue applauded the company's new management, led by CEO John Chen, for moving quickly to improve liquidity and strengthen the balance sheet.
"Firming asset metrics and transfer of liabilities may provide a cushion to BlackBerry's stock," said Mr. Sue, who previously rated BlackBerry "underperform."
"Significant long-term challenges remain, yet improving liquidity and addressing urgent balance sheet concerns may give BlackBerry time to fix its challenged businesses," he said.
That luxury of time is something BlackBerry did not have previously. "Unlike the prior management team, which bet the farm on a failed device, the new executive team is taking a pragmatic approach to stabilizing the challenged handset business, charting a course towards financial break-even metrics and working to differentiate its products and services," he said.
He now estimates BlackBerry's book value will be $3.07 a share in 12 months time, with a net cash position of $2.88 a share.
Mr. Sue also notes that unsold product inventories on BlackBerry's books are now just $254-million, down from peak level of $1.37-billion. BlackBerry's cash burn rate is declining, and new partner Foxconn may even pay for some of that inventory, he says.
"BlackBerry's new CEO is moving fast. We expect more changes over the next six months as no stone is left unturned at BlackBerry, which at one point had 17,000 employees and is now down to 7,000," he said in a research note.
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In other analyst actions:
Cormark Securities downgraded Barrick Gold to "reduce" from "market perform" and cut its price target to $16 (Canadian) from $20.
Desjardins Securities raised its price target on Sandvine to $3.60 (Canadian) from $2.80 and maintained a "buy" rating. CIBC World Markets raised it price target to $4.50 from $3 and maintained a "sector outperformer" rating.
Desjardins Securities hiked its price target on Gluskin Sheff to $29 (Canadian) from $27 and maintained a "hold" rating. CIBC World Markets raised its price target to $24 from $22 and maintained a "sector performer" rating.
CIBC World Markets downgraded Vicwest to "sector performer" from "sector outperformer" and cut its price target to $13 (Canadian) from $15.
RBC Dominion Securities cut its price target on ShawCor to $42 (Canadian) from $44 and maintained a "sector perform" rating.
JPMorgan downgraded PulteGroup to "underweight" from "neutral" and maintained an $18 (U.S.) price target.
Stifel Nicolaus raised its price target on Facebook to $65 (U.S.) from $56 and maintained a "buy" rating.
RBC Dominion Securities hiked its price target on Alcoa to $10.50 (U.S.) from $9 but reiterated an "underperform" rating.
Goldman Sachs upgraded Target to "buy" from "neutral" and raised its price target to $72 (U.S.) from $71.
Barclays upgraded Microsoft to "overweight" from "equalweight" and raised its price target to $42 from $35.
Goldman Sachs upgraded Macy's to "buy" from "neutral" and raised its price target to $65 (U.S.) from $54.
CIBC World Markets downgraded Exfo to "sector underperformer" and cut its price target to $4 (U.S.) from $4.50.
Barclays upgraded Bristol-Myers Squibb to "overweight" from "equalweight" and raised its price target to $65 (U.S.) from $52.
Barclays downgraded Eli Lilly to "underweight" from "equalweight" and cut its price target to $51 (U.S.) from $58.
Cowen downgraded Pfizer to "market perform" from "outperform" with an unchanged price target of $34 (U.S.).
Barclays downgraded Johnson & Johnson to "equalweight" from "overweight" and maintained a $99 (U.S.) price target.
FBR Capital downgraded Las Vegas Sands to "market perform" from "outperform" but raised its price target to $85 (U.S.) from $80.
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Darcy Keith