Markets & Finance

CIBC World Upgrades Agere Systems

CIBC World upgraded Agere Systems (AGR) to sector outperform from sector perform, citing factors such as the company's steps toward restructuring.

Analyst Allan Mishan says that after years of hope and disappointment following the company's spin-out from Lucent Technologies (LU), he thinks Agere Systems may finally take the steps needed to achieve long-term profitability. He believes Agere Systems is evaluating options that could prove to be catalysts for the stock, including asset sales and restructuring. He also thinks the company's guidance for $165 million in quarterly operating expenses could be reduced. He still thinks Agere Systems will face pressure in 2006, but given the chance for a positive catalyst and the company's low valuation, he says it is "prudent to speculate on Agere Systems shares despite the lack of growth." He sees 50 cents fiscal year 2006 (ending September) earnings per share.

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