Motorola shares edge higher after details on plans to split company
By APFriday, February 12, 2010
Ahead of the Bell: Motorola shares rise
NEW YORK — Investors happy about plans to split Motorola in two sent company shares higher in premarket trading Friday.
Motorola, which has been struggling with a shrinking market share in the cell phone business, said after the closing bell Thursday that it will divide the company in early 2011 so each can concentrate on a smaller market segment.
One company will focus on consumer products, including cell phones and set-top boxes, while the other develops communications networking products for business customers.
In a client note, Jefferies & Co. analyst William Choi kept a “Hold” rating on the company’s stock but said the “separation plans for the company provide clarity for strategic direction.”
Oppenheimer’s Ittai Kidron said in a note that the proposed split should leave both sides of the company more nimble in getting products to market. He reiterated an “Outperform” rating.
Shares of Motorola Inc. rose 24 cents, or 3.8 percent, to $6.89 before the market opened.
