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US: Molson Coors rating raised by CSFB

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An investment bank has predicted big things for Molson Coors Brewing Co. Credit Suisse First Boston raised its rating on the newly-merged brewer to "outperform" from "neutral" yesterday (28 March). The bank also increased its 12-month price target for the stock to US$100 from US$80.

"As a standalone company, Coors was the levered play on the US beer industry," CSFB analyst Corey Horsch said in a report to clients. "Investors favoured the shares when industry volume and pricing growth were accelerating, and avoided the shares when industry conditions were difficult."

CSFB also upped its 2005 earnings forecast to US$4.85 per share from US$4.75, and increased its 2006 forecast to US$5.79 per share from US$5.36.

Horsch believes that Molson Coors secured a strong competitive position in two high-margin beer markets - Canada and the UK. The company has the potential to double the profitability of its US business through a number of steps, Horsch said, including cost savings and merger synergies.


Sectors: Beer & cider

Companies: Molson Coors

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