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Investing.com - Benchmark maintained its Buy rating and $12.00 price target on Liberty LiLAC (NASDAQ:LILA) as the company prepares for the separation of its Liberty Puerto Rico business. The stock, currently trading at $7.49, shows potential upside according to InvestingPro data, with analyst targets ranging from $6.00 to $13.90.
The research firm expressed "high confidence" that the stock will significantly outperform within a relatively short timeline, specifically pointing to the planned separation of Liberty Puerto Rico (LPR) in the first half of 2026.
Benchmark described the Liberty Puerto Rico business as "operationally challenged and highly leveraged," noting that management is already working on "rightsizing LPR’s cost structure for post separation as well as liability management."
The firm projects approximately $800 million in cumulative free cash flow for Liberty LiLAC between 2024 and 2026, which it characterizes as "reasonable (if not conservative)" despite falling short of an earlier $1 billion target.
Benchmark emphasized that even this more conservative cash flow estimate remains "compelling" when compared to Liberty LiLAC’s current market equity value of approximately $1.55 billion.
In other recent news, Liberty LiLAC has had its stock rating reiterated at Buy by Benchmark, with a maintained price target of $12.00. This decision reflects the company’s long-term growth potential across more than 20 markets in Latin America. Liberty LiLAC has achieved Fixed Mobile Convergence penetration exceeding 30% in its major markets, with significant growth potential remaining due to stable duopoly market structures. Benchmark analysts also reiterated their Buy rating for Liberty Latin America, maintaining the same $12 price target. They expressed confidence in the stock despite market uncertainties related to tariff policies affecting Caribbean and Central American economies. The analysts described Liberty Latin America’s current stock price as significantly exaggerating a capital call for Liberty Puerto Rico, which they believe is not necessary due to the company’s siloed debt structure. Benchmark’s price target considers a nearly $900 million negative equity value for Puerto Rico, based on debt at an 8.0x ratio of annualized Covenant EBITDA from the last two quarters. These developments highlight the analysts’ optimism about Liberty LiLAC and Liberty Latin America’s financial strategies and market positions.
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