UBS (NYSE:UBS) stock is a hot topic among traders on Monday with one analyst offering a new rating for shares.
Bank of America analyst Alastair Ryan is behind the upgrade for UBS stock today. This has the analyst bumping shares up from a “neutral” rating to a “buy” rating. For comparison, the analyst consensus rating for UBS stock as of this writing is “hold” with 11 opinions.
To go along with that upgrade, Ryan also increased his price target for UBS from $22.65 per share to $24.81 per share. That represents a potential 36.3% upside compared to its closing price on Friday. For the record, the analyst consensus price target for UBS is $18.18 per share as of this writing.
It’s worth pointing out that the upgrade for UBS stock comes after the company announced plans to acquire struggling rival Credit Suisse (NYSE:CS). The company is spending $3.2 billion on the takeover deal.
Logic Behind the UBS Stock Upgrade
The Bank of America analyst said the following in a note to clients obtained by CNBC:
“We think the objective of this transaction, while solving CS’ situation & associated risks for the system, is to reach a win/win, where UBS shareholders also get value out of this deal over time.”
UBS stock is up 5% as of Monday morning. That comes alongside 19 million shares changing hands. The company’s daily average trading volume is closer to 2.6 million shares.
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On the date of publication, William White did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
