Takeover Speculation Boosts PairGain Stock

PairGain Technologies Inc.’s stock climbed 12% in heavy trading Friday after a New York analyst upgraded his rating, citing the Tustin telecommunications equipment provider’s potential as a takeover target. The shares rose 12%, or $1.69, to $15.63. Volume surpassed 8.2 million shares, making the stock the 10th most active issue Friday in U.S. markets. The analyst, Timothy Savageaux, also cut the company’s earnings estimates after factoring in additional price competition in PairGain’s segment of the telecommunications market. He reduced the second quarter earnings estimate to 16 cents a share from 18 cents, and the 1998 projection to 70 cents, down from 75 cents. But the earnings forecasts are less significant than the company’s takeover potential, Savageaux said.