Merrill Lynch Japan Upgrades Sharp, Downgrades Sony

| About: Sony Corporation (SNE)
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According to Radio Nikkei, Merrill Lynch Japan Securities upgraded Sharp ( from "neutral" to "buy" while downgrading Sony (SNE) from "neutral" to "sell."

ML's target share price for Sharp is 2,300 yen. Sharp (TSE ticker: 6753) closed higher today in Japan up .99% at 2,035 yen. ML estimated Sharp's FY2006 (full year ending March 2007) consolidated profit at 10% above FY2005 to 178 billion yen (approx. US$1.51b at Y118/US$1). Net income growth is seen driven by the 2nd Kameyama Factory for producing LCD-TV panels launching later this year, successful cost cutting measures, and an increase in demand for higher quality mobile phone LCD screens.

ML expects Sony to trade in a range of +/- 10% from 4,600 yen per share. Sony (TSE ticker: 6758) shares were down 2.83% at closing to 5,500 yen. In its report on Sony, ML cited the increasing risk of a short-term correction as the expectations for Sony's shares are too high.

SHCAY 1-yr chart:

SNE 1-yr chart: