Standard & Poors’ analyst, Mathew Albrecht, maintains sell rating on Merrill Lynch (MER):
a. CEO John Thain said yesterday that the firm might sell its stakes in Bloomberg or BlackRock (BLK), which would be less dilutive to shareholders than an outright capital raise.
b. S&P believes a Bloomberg sale would make the most sense, since the BLK stake plays a larger strategic role for the company.
c. S&P believes continued write-downs in the second quarter, which they think may lead to a sale.
d. Target price is $32, about 1.2 times its yearend projected book value, a discount to peers.
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Filed under: Investment Tips, Portfolio Picks, Stocks to Buy, Stocks to Watch Closely
