Deutsche Bank announced on Tuesday that it had raised its recommendation on Philips shares from 'sell' to 'hold', with a parallel target increase from 17 to 25 euros.

In a research note, the consultancy says that the settlement reached with the US courts on the Respironics case removes the "sword of Damocles" that had been hanging over the stock.

In its view, the out-of-court settlement reached over the sleep therapy and respiratory assistance devices can even be considered a "great success".

Not only has it been concluded ahead of schedule, but it also seems sufficiently comprehensive to guarantee that it will be finalized", stresses Deutsche Bank.

"One must always be cautious when it comes to legal cases, and we are not legal experts, but it seems unlikely that Philips will have to pay more than the agreed 1.1 billion euros", concludes the analyst.

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