Investing.com – Here’s a professional summary of what Wall Street analysts said over the past week.
InvestingPro subscribers always get priority access to market-moving AI analyst commentary. Upgrade today!
apple
What happened? On Monday, MoffettNathanson rated Apple (NASDAQ:) stock at Neutral with a price target of $211.
*Tilder: MoffettNathanson ponders whether Apple is overvalued and/or overvalued. The firm also expresses concerns about Apple’s AI capabilities, citing “unclear data on acceptance in Greater China and potential regulatory challenges.”
What is the full story? MoffettNathanson analysts question whether Apple is overvalued, noting that the stock price reflects an iPhone upgrade cycle that is expected to be much larger than the 5G cycle in 2021/22. They express skepticism about this assumption and highlight the overlooked regulatory risks associated with Apple’s contract with Google (NASDAQ:) for default search placement. While the firm expects Apple to execute its strategy well, it believes the market has already priced in that expectation. The key question remains whether the expected upgrade cycle driven by Apple Intelligence will be larger or smaller than expected.
The firm also raised concerns about Apple’s future outside of AI, including unclear data on Apple’s acceptance in Greater China and potential regulatory challenges that could impact Apple’s competitiveness. Despite the positive bias toward Apple’s AI strategy, MoffettNathanson concluded that current valuation suggests the market has already priced these factors in. It recommends waiting for a shake-up in market confidence before making further investments.
Neutral in MoffettNathanson means “Neutral recommendations are typically within 15% of fair value.”
AMD
What happened? On Tuesday, Edward Jones initiated coverage on Advanced Micro Devices (NASDAQ: ) at a buy level with no price target. AMD was also added to Edward Jones’ list of target stocks.
*Tilder: Edward Jones analysts believe AMD will see significant growth driven by growing demand for data center infrastructure and the integration of Xilinx’s programmable chip products, with a potential $10 billion opportunity. The firm also highlights that the PC market recovery, driven by AI-powered PCs, could lead to sustained growth, which has yet to be fully reflected in AMD’s current stock price.
What is the full story? Edward Jones analysts believe AMD is poised for significant growth due to several key factors. Growing demand for data center infrastructure is expected to boost AMD chip sales, particularly for GPUs and CPUs. Additionally, the acquisition of Xilinx (NASDAQ:) has introduced new programmable chip products and expanded AMD’s market reach. Analysts note that AMD is still in the early stages of integrating and selling Xilinx and AMD products, with management estimating the opportunity could be worth as much as $10 billion.
Furthermore, analysts highlight that the PC market, which has started to recover, could see sustained growth driven by AI-powered PCs, potentially leading to a longer upgrade cycle. They stress that this optimism has not yet been fully reflected in AMD’s current stock price, suggesting further appreciation is possible.
A Buy from Edward Jones means “We believe the valuation is attractive and the total return potential is above average over the next three to five years compared to industry peers.”
Bright View Holding
What happened? On Wednesday, Jefferies upgraded BrightView Holdings (NYSE:) to Buy with a $17 price target.
*Tilder: Jefferies upgraded BV stock from Hold to Buy, forecasting low-single-digit revenue growth and record margins, driven by the new CEO’s leadership and significant progress over the past 10 months. The brokerage expects margins to expand from around 11% in FY23 to more than 13%, supported by cost reductions, profitable growth and improved client and employee retention.
What is the full story? Jefferies has upgraded BrightView from Hold to Buy, expecting a return to low-single-digit revenue growth and record profit margins. The optimism is driven by the leadership of a new CEO with an exceptional track record who has made significant progress at BV over the past 10 months. The brokerage expects margins to expand from around 11% in FY23 to more than 13%, supported by the company’s focus on cost reduction, profitable growth, and improved client and employee retention.
The brokerage’s confidence in BV’s future performance is bolstered by the advanced management team and strategic initiatives implemented under the leadership of the new CEO. These efforts are expected to drive revenue growth and margin expansion, positioning BV to deliver strong financial performance in the coming years.
Buy from Jefferies means “describing securities that we expect to provide a total return (price appreciation plus yield) of 15% or more over a 12-month period.”
Crocs
What happened? On Thursday, Williams Trading upgraded Crocs (NASDAQ:) stock to Buy with a $163 price target.
*Tilder: Sidney Sweeney’s role as brand ambassador should appeal to younger consumers and boost HEYDUDE’s visibility, boosting revenue estimates for fiscal 2024 and fiscal 2025 to $873 million despite guidance for a decline of 8%-10%. Analysts are highlighting Crocs/HEYDUDE’s “clean market” and “data-driven customization options” to put pressure on rivals like VANS.
What is the full story? The research team believes that the addition of Sidney Sweeney as a brand ambassador/global spokesperson will appeal to younger consumers and bring much-needed attention to the HEYDUDE brand. Williams Trading expects the agreement with Sweeney to continue through at least 2025. As a result, the research team has increased its FY24 and FY25 revenue estimates for HEYDUDE from $859.5 million to $873 million, despite guidance for an 8% to 10% decline in revenue for FY24. They are confident that Crocs’ history of long-term brand marketing that drives positive short-term results will begin to show up for HEYDUDE.
Analysts stress the importance of maintaining a clean marketplace and executing a traction model for both Crocs and HEYDUDE. They stress the need for sales teams and retailers to fully embrace data analytics to make allocation and distribution decisions and discontinue MAP breaks within core styles and designs. Looking at the spring 2025 product lineup, the team notes that the offerings for both brands have become more focused. New products like the Crocs Echo Wave Mule and Echo Surge Sneaker, along with the return of the Bae platform clog, are expected to perform well. The introduction of the Wally, Wendy Comf, and updated styles from HEYDUDE also hold promise, provided demand is carefully planned and allocated correctly. The increased focus on HEYDUDE could put pressure on competitors like Vans and other casual canvas brands in the near term.
A buy from Williams Trading means “the stock’s total return (price appreciation plus dividend yield) is expected to exceed 15% over the next 12-month investment horizon.”
year
What happened? On Friday, Guggenheim upgraded Roku Inc (NASDAQ:) stock to Buy with a $75 price target.
*Tilder: Profitability is improving. Investors are likely to recognize management’s efforts to improve advertising sales.
What is the full story? Guggenheim expects investor enthusiasm for Roku to grow ahead of its third-quarter earnings call in November, as the company makes progress in expanding video inventory ad sales across third-party demand platforms and improving home screen monetization. That progress is expected to bolster confidence in Roku as a unique acceleration story in 2025. The brokerage’s revised rating reflects pre-consensus financial estimates for 2024 and 2025, and an attractive relative valuation based on a 15% normalized OIBDA margin, which they believe the company will achieve through revenue growth and cost management.
Despite concerns about Roku’s slow response to the connected TV market and competitive pressures in advertising and connected TV, Guggenheim believes that the enhanced profitability and leadership execution from Roku Media President Charlie Collier and CFO Dan Gedda will drive growth and disciplined performance over the next three to six months. This is expected to increase investor enthusiasm and position the company for better long-term performance.
Buy in Guggenheim means “describing stocks that we expect to provide a total return (price appreciation plus yield) of 10% or more over a 12-month period.”
Comments are closed, but trackbacks and pingbacks are open.