Hey Art, Ever heard of a "strong" overweight?...
Merrill Lynch Upgrades Brazil TelemigCel To Strong Overweight
28 May 2002, 10:19am ET
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NEW YORK -(Dow Jones)- Merrill Lynch raised Monday its equity portfolio recommendation on Brazilian telecommunications company Tele Norte Leste Participacoes SA (TNE), or Telemar, to overweight from underweight, and on Brazilian wireless service provider Telemig Celular Participacoes SA (TMB) to strong overweight from no exposure.
Merrill financed its move with cash in the portfolio and by cutting exposure to Brazilian oil company Petroleo Brasileiro (PBR) to underweight from overweight.
Latin American telecoms are relatively sheltered from world-wide problems in the industry, which has underperformed other sectors this year, Merrill said. Also, telecoms in selective countries can do well when moved by specific developments within those economies, Merrill added.
"We continue to see Brazil as having the best potential for domestic catalyst improvements, namely monetary policy, oil prices, politics, potential improvements in country risk and earnings momentum," Merrill said in a research note.
Merrill added exposure to Brazil in its portfolio for the first time since January. It expects to do the same to other "domestic driven stories" in the next few weeks.
-By Sonja Ryst, Dow Jones Newswires; 201-938-2245; sonja.ryst@dowjones.com
(This story was originally published by Dow Jones Newswires)
Copyright (c) 2002 Dow Jones & Company, Inc.
All Rights Reserved
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