UPDATE: Citi Color On VMED Target Increase

Citi, which raised its PT on shares of Virgin Media VMED, is providing some color on the stock.

“Virgin is a play on super-fast broadband, interactive and mobile TV, smartphones, de-equitisation and falling financing costs,” Citi writes. “Indeed, emerging market growth is perhaps the only worthwhile telco sector trend that it is not a play on, in our view.

“Last quarter every division grew revenue, with group sales up 6.6% yoy LFL, EBITDA up 9.9% and FCF up 13% yoy on our preferred definition. While its top line growth is below its German and Belgian peers', its EBITDA margin is lower and, we believe, has scope to rise while its tax position is more favorable. It remains our top cable pick in Europe.”

Virgin Media closed Thursday at $27.19.