Citigroup upgrades TalkTalk to buy from neutral

20th May 2015 11:02

Citigroup upgraded TalkTalk to 'buy' from 'neutral' and raised its target price to 475p from 320p."We see TalkTalk as likely to benefit should one or both of the UK's two big telco deals facing competition authority review be approved," said Citi.The bank said that TalkTalk's price-sensitive consumer broadband customer base is likely to be receptive to discounted mobile offers and it looks well placed to exploit quad play. A quad play network is one that offers broadband, mobile, telephone and TV services."If quad play takes hold in the UK, which seems likely but not imminent, TalkTalk may be seen as a potential bid target for a mobile operator without a scale consumer fixed broadband," said Citi.In addition, Citigroup pointed to potential for the company from the growing adoption of video on demand in place of traditional linear TV and said the acquisition of Blinkbox is a positive in building up its capabilities here.