RBC Capital analyst Stuart Bush this morning boosted his rating on MEMC Electronic Materials (WFR) to Sector Perform from Underperform, with a new target price of $12, up from $9.50. The stock closed yesterday at $11.76.
Bush says the sale price for the company’s Rovigo, Italy plant, announced yesterday, is higher than investors had expected. “Additionally, we see solar margin upside near-term from improved outsourced wafering costs, and are more constructive on 2011 poly/wafer pricing given stabilized credit markets and attractive project
IRR versus government bond yields,” he writes. “In our view, supply chain pricing pressure will be partially offset by lower hurdle interest and return rates for investors and lender.”
For 2010, the analyst now sees EPS of 51 cents, up from 20 cents; for 2011, he goes to $1.20, from 73 cents.
WFR is up 37 cents, or 3.2%, to $12.13.
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