UPDATE: Bank Of America Initiates Coverage On Restaurant Brands International

Bank of America initiated coverage on Restaurant Brands International Inc. (NYSE: QSR) with a Buy rating and $40 price target.

Analysts led by Andrew M. Charles continued “to view the Burger King/Tim Hortons combination favorably, driven primarily by the anticipated rapid growth in Tim Hortons’ openings internationally via master franchise agreements in the same way that Burger King is building international presence.”

Charles also had a “positive bias for 3G’s involvement which should lead to significant reductions in costs and CapEx at Tim Hortons as the company implements a similar playbook as executed at BKW.”

According to the analyst note, “With the company's extensive global operations, differences in foreign exchange naturally present risks. The downside risks to our price objective relate to potential differences in Burger King and Tim Hortons' cultures, which could lead to internal differences similar to any acquisition.”

The price target was derived by applying a 17x EV/EBITDA multiple to the firm’s estimate of the company's EBITDA in 2015.

Restaurant Brands International recently traded at $35.48, up 0.54 percent.