Wedbush Raises Cypress Semiconductor Price Target Following Merger With Spansion
In a research report issued today, Wedbush analyst Betsy Van Hees maintained a Neutral rating on Cypress Semiconductor (NASDAQ:CY) but raised her price target to $12 (from $10), which represents a slight upside potential from current levels. The report follow the news that the company has signed a definitive agreement to merge with Spansion (NYSE:CODE) in a tax-free, all-stock transaction valued at about $4B.
Van Hees wrote, “We don’t expect a competitive bid for CODE or CY to raise its offer price and view the pending merger as a great marriage, with complementary product portfolios and considerable long-term cost saving opportunities. While the stock had a nice move in AHs trading, we think in the nearterm from here, CY shareholders will have to be content with the 4% dividend.”
Furthermore the analyst noted, “We believe the synergistic benefits may take awhile to realize due to the time needed to complete the transaction, lower OpEx, integrate, and qualify manufacturing to get the scale and move the model towards the impressive LT targets.”
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Betsy Van Hees has a total average return of 20.6% and a 71.4% success rate. Van Hees has a -2.6% average return when recommending CY, and is ranked #116 out of 3391 analysts.