CIBC Ups Lexar Media
CIBC World ups Lexar Media (LEXR ) to sector outperform.
Analyst Daniel Gelbtuch says he's upgrading Lexar Media from sector underperform following a $381 million verdict in Lexar's favor in Toshiba trade-secrets case.
He notes the jury also found an award of punitive damages (arguments begin today), which represent an additional upside. He says under California law, punitive damages could be as high as $1.96 billion, though he sees an award of $1 billion as more realistic.
Gelbtuch notes $1 billion would represent $12.64 cash per Lexar share. He sets a $7 price target and plans to update the model for Lexar after the company hosts a conference call. He currently sees a 72-cent 2004 loss and a 40-cent 2005 loss.