BW Online | December 9, 2003 | S&P Says Buy Fortune Brands

Mentor Graphics (MENT ): Maintains 4 STARS (accumulate)
Analyst: Richard Tortoriello

S&P is lowering the 12-month target price to $20, from $24. The new target price represents a multiple of 24 times S&P's 2004 earnings per share estimate of 82 cents. Mentor has three new product lines that are growing rapidly and now contribute significantly to sales: Calibre, TestKompress, and wire harness design products. In addition, the more mature printed circuit board product line continues to perform well. Mentor currently sells at 1.5 times sales, vs. 4.3 times for its two larger competitors, and below the 10-year average of 1.8. S&P views the shares as attractive.