Credit Suisse First Boston upgraded Halliburton (HAL) to outperform from neutral.
Analyst Ken Sill says Halliburton is close to a deal that would will resolve all asbestos-related personal injury claims against the company. The tenative terms of the deal include a payment of up to $2.8 billion in cash and issuance of up to 60 million Halliburton shares, implying a total settlement cost of approximately $4 billion.
Sill says the best and worst case scenarios indicates Halliburton's fair value between $25 and $29 based on current peer valuations. He also says assuming a settlement is close, Halliburton should not only close its current relative valuation gap, but also participate in an expected upside in its group.
He sees 71 cents 2002 earnings per share, and $1.30 for 2003. Sill raised his target to $30.