) to overweight from equal-weight.
Analyst Daniel Ford raised his $22 price target to $30, reflecting potential upside from a successful restructuring. He believes the stock will discount upside at the company, well ahead of execution as seen in other cases like TXU (TXU
) and Allegheny Energy (AYE
He sees an upside from the benefit of redeploying potential $1.7 billion of cash raised through asset sales to restructure balance sheet, cost cuts, and improved generation performance, including a 20% stock buyback. Ford raises base case 2005 earnings-per-share estimate to $1.16, and 2006 earnings per share to $1.50, to reflect a more reasonable 6.5% pretax return on investment portfolio than the 2.0% he was using.