(Reuters) - Merrill Lynch analyst Jessica Reif Cohen on Wednesday raised her intermediate term rating on AOL Time Warner Inc. (AOL) to "buy" from "neutral" a day before the world's largest Internet
and media company's annual meeting, citing valuation. "While our upgrade does not suggest that fundamentals of the AOL division have improved, it reflects our view that the share price is
appropriately discounting the downside and any hint of positive news flow should provide a significant lift to the stock," Cohen said in a research note. She said a variety of problems the company is
facing -- such as financial constraints, management credibility, losses at its high-speed Internet service Road Runner and resolution of the company's cable partnerships -- are likely to be resolved
in a clean-cut and timely manner and, that alone, should provide a catalyst for the stock.