Bethel Finance:Barclays sees upside in Partner, Bezeq

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Bethel Finance news:
Barclays Capital focuses on Orange franchisee Partner Communications Ltd. (Nasdaq: PTNR; TASE: PTNR) and Bezeq Israeli Telecommunication Co. Ltd. (TASE: BEZQ) in a new review of Israel's telecommunications sector. Analyst David Kaplan has raised his recommendation for Partner to "Overweight" from "Equal weight", and reiterated his target price of NIS 38, a 19% premium on Thursday's closing price on the TASE of NIS 31.85.

Kaplan says, "In our view, the market is missing the mark on valuation, overpricing the risks and distracted by noise surrounding Scailex Corporation (TASE: SCIX; Pink Sheets:SCIXF), Partner's controlling shareholder." Ilan Ben Dov controls Partner through Scailex.

" We see upside to the current share price, based on what we believe are achievable EBITDA and net income estimates for 2012," Kaplan says.

Bezeq is Barclays' top pick for the sector. "We believe recent market weakness reflects an overstatement of risk and represents a buying opportunity given the 2012 estimate of 16% dividend yield of NIS 1.06 per share." Kaplan reiterated his "Overweight" recommendation but cut his target price from NIS 8.20 to NIS 7.80, an 18% premium on Thursday's closing price of NIS 6.60.

Kaplan reiterated his "Underweight" for Cellcom Israel Ltd. (NYSE:CEL; TASE:CEL) and cut his target price from NIS 59 to NIS 56, compared with Thursday's closing price on the TASE of NIS 55.

Kaplan cut his recommendation for HOT Telecommunication Systems Ltd. (TASE: HOT) to "Equal weight" and cut his target price from NIS 69 to NIS 50, a 5% upside on Thursday's closing price of NIS 47.71. He says, "Pressures will weigh and the recent dividend announcement is already priced in."

Partner's share price rose 2.5% by midday on the TASE today to NIS 32.45, after rising 1.2% on Nasdaq on Friday to $8.81, giving a market cap of $1.37 billion. Bezeq's share price fell 0.8% to NIS 6.54, giving a market cap of NIS 17.9 billion. Cellcom's share price rose 0.3% to NIS 56, after rising 1.5% on the NYSE on Friday to $15.13, giving a market cap of $1.5 billion. Hot's share price fell 1.9% to NIS 46.77, giving a market cap of NIS 3.7 billion.