stock rises on analyst upgrade
By Andy Vuong, Staff Writer
Saturday, June 9, 2007
Qwest stock shot up today after a Bank of America analyst
upgraded the company and stated that improved cash flow could
lead to a dividend or another share buyback.
"Qwest is growing and has grown its business more substantially
than other" local exchange carriers, Bank of America analyst
David Barden said in a research note.
Barden upgraded Denver-based Qwest from "neutral" to "buy" and
raised his target price on the company's stock from $8.50 to
Qwest stock was up 32 cents to $10.09 during midday trading,
regaining nearly all of its losses from Thursday when the
markets took a hit amid rising interest rates.
Barden said what differentiates Qwest from its peers is its
"enterprise data and Internet business," which is growing by
about 7 percent.
"Qwest has the willingness and the financial wherewithal to
return cash to stockholders," Barden said. "The company is
currently in the midst of a $2 billion stock buyback that should
conclude by the third quarter of 2008. The company has been
clear that it views this initial return of capital as the
'beginning, not the end' of cash distributions to stockholders."
Barden noted that his views on Qwest could be negatively
impacted if the company decides to spend capital on a broad
video strategy to better compete against cable companies rather
than reward shareolders with a dividend or another share
Staff writer Andy Vuong can be reached at 303-954-1209 or