Shares of Visteon Corp have moved higher this week after an analyst upgraded the auto supplier citing the possibility that a part or all of the company may be bought by Valeo. There were rumours last month that Valeo is eyeing Visteon assets.
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Brett D. Hoselton of KeyBanc Capital Markets boosted his rating for Visteon to “Hold” from “Underweight,” saying that “a very credible industry source” had confirmed that Valeo has done due diligence work on Visteon, AP reported.
“In our opinion, such work indicates Valeo’s interest in purchasing either a portion or the entirety of Visteon, increases the probability of a partial or outright sale of Visteon, confirms many of the speculative news articles rumoring the possibility of such an event and, in our opinion, warrants a more neutral stance toward the stock and a ‘Hold’ rating,” Hoselton wrote in a note to investors.
Hoselton said he believes there are significant problems that still make a partial or outright sale of Visteon to Valeo unlikely. But if a sale were to take place, Valeo could speed up growth in its key Asia and thermal segments, he said.
The analyst maintained his prediction of a loss of 93 cents per share in 2006 and a loss of 67 cents per share in 2007, the AP report added.
See also: FRANCE: Valeo after Visteon
