Motorola (MOT) shares got a lift Monday morning after RBC Capital’s Mark Sue raised his rating on the stock to Outperform from Sector Perform, asserting that the company “is displaying firming trends in its once beleaguered handset division.”
Sue says his call is “early,” but that investors should “expect further evidence that points of improvement may emerge over the next few quarters as Motorola perks up its product portfolio and accelerates its profitability targets.”
According to Sue, the feedback on the new RAZR2 phone so far is good. In key regions of North America and Latin America, he writes, “shares losses may have subsided.”
His bottom line view: “the situation is firming at Motorola…and with valuation support we recommend building a position at current levels.”
He raised his price target on the stock to $21 to $20.
As it happens, Sue was not the first analyst to jump back into the pool: Cowen upgraded the stock last week, citing a pending shortage of mobile phones.