Dilution Lowers Adelphia Target

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Salomon Smith Barney Inc. analyst Niraj Gupta reiterated his "buy" rating on Adelphia Communications Corp., but lowered his 12-month price target on the stock in light of a recent debt and equity offering. Earlier this month, the MSO issued 40 million common shares and $500 million in convertible preferred stock, raising $1.5 billion to reduce its bank debt. While the offerings helped lower Adelphia's debt-to-cash flow ratio to 8 times from 8.9 times, Gupta lowered his price target on the stock to $37 from $39 to account for dilution. Adelphia shares closed at $26.01 on Jan. 23, down 4 cents each.