(Reuters) - American Technology Research raised its rating on the stock of Motorola Inc to “neutral” from “sell,” citing the mobile phone maker’s decision to split off its handset division.
Analyst Mark McKechnie said the “quick and important move” gives the division a chance to begin effecting a turn-around.
Earlier in the day, Motorola had said it would split into two publicly traded entities to separate its loss-making handset division from its other businesses.
The move came amid an intensifying proxy battle against activist investor Carl Icahn ahead of a May 5 annual meeting.
However, Lehman Brothers cut its price target on the stock to $12 from $13, while UBS lowered its price target to $10.50 from $12.
Lehman Brothers analyst Jeff Kvaal, who kept his “overweight” rating on the stock, said he continued to expect the Motorola and Icahn camps to compromise on board representation in the near term.
UBS’ Maynard Um said Motorola’s enterprise mobility segment would see “typical” first-quarter seasonality, while the home and network segment would see a sequential decline.
Um has a “neutral” rating on the stock.
Reporting by Bijoy Koyitty in Bangalore; Editing by Jarshad Kakkrakandy