Alcoa Shares May Reach $59 in a Takeover, Credit Suisse Says

Alcoa Inc. shares may be valued as high as $59 if the world's second-largest aluminum company is taken over, according to Credit Suisse Group. That would be 26 percent higher than the company's record reached yesterday. Alcoa yesterday withdrew its hostile $27.7 billion takeover bid for Alcan Inc. after mining company Rio Tinto Group topped the offer by agreeing to pay $38.1 billion. Alcoa's failure to buy Alcan has led to speculation that Alcoa itself might become a takeover target. Analyst David Gagliano said the takeover speculation would support Alcoa's stock price, estimating that shares of the company may be valued between $55 and $59 a share. "With the risk of a bidding war now behind the company and with speculation likely going to continue regarding potential bidders emerging for Alcoa," the shares may rise toward the high end of its estimated value, Gagliano wrote in a note to investors. The analyst also boosted his 12-month price target by 22 percent to $55 a share and reiterated the company's "outperform" rating. Alcoa shares gained $1.58, or 3.5 percent, to $46.87 in trading before the open of U.S. exchanges. Shares of the New York-based company have risen 41 percent over the past year.