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TechStock Radar
E-mail: Rob@techstockprospector.com
Technorati
March 2018
Archives
 
Thursday, March 29, 2018, 10:07 AM — by Rob DeFrancesco, TechStock Radar
Jefferies Likes Square After Pullback

The pullback in Square (SQ, $48.15) shares from the all-time high of $58.46 reached on March 21 presents a “compelling buying opportunity,” according to Jefferies. The firm reiterates its price target of $60.

At yesterday’s low of $46.14, Square shares were off 21% from the high.

By 2022, Jefferies expects Square’s subscription & services offerings (including instant deposits and food delivery) to represent about half of adjusted net revenue (up from 26% today), which should “prove nicely additive to valuation.”

 
Thursday, March 29, 2018, 9:51 AM — by Rob DeFrancesco, TechStock Radar
SunTrust: Facebook Sell-Off Overdone

SunTrust thinks the recent sharp sell-off in Facebook (FB, $154.52) shares is overdone. The firm maintains its price target of $225.

Digital advertisers that SunTrust has spoken with are not leaving the platform, citing Facebook’s marketing effectiveness. And there are few signs of “users fleeing Facebook en masse,” says the firm.

With the likelihood of limited regulatory actions, SunTrust views Facebook shares as having a “compelling valuation” at recent levels.

 
Wednesday, March 28, 2018, 10:37 AM — by Rob DeFrancesco, TechStock Radar
Jefferies Remains Bullish on NVIDIA

Jefferies maintains its NVIDIA (NVDA, $221.10) price target of $300, saying it believes the company’s first-mover advantage in its artificial intelligence (AI) ecosystem is undervalued by Wall Street.

NVIDIA’s platform is “years ahead of competitors, and akin to the iPhone ecosystem or Wintel in PCs,” according to Jefferies.

The firm views the company’s decision to suspend testing on autonomous vehicles as prudent, and expects self-driving car technology to improve over time.

 
Wednesday, March 28, 2018, 10:09 AM — by Rob DeFrancesco, TechStock Radar
Morgan Stanley Lifts FireEye Target

Morgan Stanley raises its FireEye (FEYE, $17.10) price target to $21 from $19 based on a strengthened product portfolio, simplified marketing message, greater channel contribution and a durable renewal base.

The firm now has greater conviction about FireEye’s ability to achieve management’s billings and free cash flow targets, with room for upside.

 
Wednesday, March 28, 2018, 9:58 AM — by Rob DeFrancesco, TechStock Radar
Goldman Cautious on iPhone Demand

Goldman Sachs reduces its Apple (AAPL, $166.86) iPhone unit forecasts for the March and June quarters, saying it believes handset demand is below Wall Street estimates. The firm also lowered its ASP expectations. Goldman maintains its AAPL price target of $159.
 
Tuesday, March 27, 2018, 9:45 AM — by Rob DeFrancesco, TechStock Radar
Loop Sees Positive Catalyst for Amazon

Loop Capital believes Amazon (AMZN, $1,571) is a beneficiary of the recent customer data protection issues at Facebook (FB).

Advertisers now have a catalyst for migration over to Amazon, argues the firm.

Loop maintains its AMZN price target of $1,700, saying Amazon can become a force in digital advertising based on its extensive user data, technological expertise and deep pockets.

 
Tuesday, March 27, 2018, 9:37 AM — by Rob DeFrancesco, TechStock Radar
Needham Hikes SailPoint Target

Needham raises its SailPoint Technologies (SAIL, $21.31) price target to $25 from $23.50 after concluding that the company’s technology should benefit from increasing cloud architectures and customer digital transformation initiatives.

The firm thinks SailPoint’s new products such as Identity Now and Identity AI, while small currently, fit well with the emerging needs of target customers and should have an increasingly positive impact on the company’s overall sales motion.

 
Monday, March 26, 2018, 10:04 AM — by Rob DeFrancesco, TechStock Radar
Baird Trims Facebook Target

Baird reduces its Facebook (FB, $156.03) price target to $210 from $225, but maintains its ‘Outperform’ rating.

The firm says a survey it conducted suggests little impact on ad revenue so far, but it sees the potential for brands and smaller businesses to pause Facebook campaigns until headlines subside.

Baird’s survey did show continued moderation in social media usage. The firm lowers its price target because it would not be surprised by further slippage in usage metrics in Q1.

 
Monday, March 26, 2018, 9:53 AM — by Rob DeFrancesco, TechStock Radar
Morgan Stanley More Bullish on Microsoft

Morgan Stanley believes Microsoft (MSFT, $92.17) is poised to maintain a dominant position in the public cloud market. The firm raises its price target to $130 from $110.

Morgan Stanley says Microsoft’s public cloud offering is differentiated from those of cloud giants Amazon (AMZN) and Alphabet (GOOGL) because it spans from core infrastructure services to PaaS capabilities, and up the stack to the application layer.

The firm expects the combination of public cloud assets paired with Microsoft’s large existing customer base, broad developer base, expansive distribution channel and strong on-prem technology to drive continuing share gains over the next three years.

Microsoft shares this morning are up more than 5%.

 
Friday, March 23, 2018, 10:40 AM — by Rob DeFrancesco, TechStock Radar
Amazon in the Smart Home

JP Morgan reiterates its Amazon (AMZN, $1,537) price target of $1,650, saying the smart home category represents a significant growth opportunity for the company.

The firm estimates Amazon’s smart home total addressable market in the U.S. is worth more than $50 billion.

Beyond its size, the smart home is a strategically important category, as it provides Amazon with an in-home presence, greater access to data and the potential to drive more shopping in other categories through Echo devices (Alexa), says JP Morgan.

 
Friday, March 23, 2018, 10:25 AM — by Rob DeFrancesco, TechStock Radar
JMP Ups Veeva Target to $80

JMP Securities raises its Veeva Systems (VEEV, $75.69) price target to $80 from $74 based on a solid overall business tone, benign competition and the ramping of the Development Cloud across the Vault unit.

The firm believes QualityOne represents Veeva’s entry into the world outside of life sciences, which over the longer-term could represent a total addressable market (TAM) that exceeds the entire life sciences Vault TAM of $4 billion.

 
Thursday, March 22, 2018, 10:02 AM — by Rob DeFrancesco, TechStock Radar
RBC Capital L/T Bullish on Cisco

RBC Capital maintains its Cisco Systems (CSCO, $43.79) price target of $50, saying capital allocation, higher revenue and a continued mix shift to software/services can lead the company to achieving EPS growth toward its objective of $3.50+ by 2020.

The firm sees upside potential from higher than expected revenue growth in the core Infrastructure Platforms unit thanks to demand for the Catalyst 9000 series as well as margin expansion driven by mix shift.

 
Thursday, March 22, 2018, 9:54 AM — by Rob DeFrancesco, TechStock Radar
2 Views on Facebook

Stifel reduces its Facebook (FB, $167.56) price target to $168 from $195 to reflect a potential loss of user trust, while RBC Capital maintains its price target of $250, saying the company is still the best growth story in tech.

RBC Capital warns that user and engagement growth could suffer in Q1/Q2 amid the negative media attention brought to the company. But the firm believes the stock is now trading at a valuation trough, with a compelling medium-to-long term risk/reward balance.

 
Wednesday, March 21, 2018, 10:41 AM — by Rob DeFrancesco, TechStock Radar
KeyBanc Still Positive on Facebook

KeyBanc maintains its Facebook (FB, $168.71) price target of $245. The firm believes the firestorm of news headlines and Facebook’s poor navigation through the current data governance situation has driven an increase in uncertainty that has far surpassed the risk to the company’s cash flow growth.

KeyBanc sees potential positive catalysts in earnings, an eventual reasonable response from the company and the passage of the height of negative headline volume.

 
Wednesday, March 21, 2018, 10:18 AM — by Rob DeFrancesco, TechStock Radar
Salesforce to Acquire MuleSoft

Salesforce (CRM, $122.65) late yesterday announced the $6.5-billion acquisition of TSP Small-Cap Portfolio holding MuleSoft (MULE, $44.34), provider of an application integration platform, in a deal worth $6.5 billion.

Salesforce is paying $36 a share in cash plus .0711 CRM shares.

MuleSoft was added to the TSP Small-Cap Portfolio last September at $20.91. The buyout price is approximately $44.70.

For more on MuleSoft, see the March 2018 issue of Tech-Stock Prospector.

 
Tuesday, March 20, 2018, 10:35 AM — by Rob DeFrancesco, TechStock Radar
BofA/Merrill Downgrades Oracle

BofA/Merrill downgrades Oracle (ORCL, $47.10) to ‘Neutral’ and lowers its price target to $57 from $62, saying the pace of progress to the cloud is taking longer than expected.

The firm thinks Oracle shares lack near-term catalysts given mixed SaaS results, slowing operating margin growth and tepid SaaS guidance.

Oracle shares this morning are down more than 9%, falling below the 200-day moving average of $49.15. There’s short-term support at $45.92.

 
Tuesday, March 20, 2018, 10:08 AM — by Rob DeFrancesco, TechStock Radar
UBS Remains Positive on Facebook

UBS believes current positive ad trends at Facebook (FB, $168.50) run counter to investor fears. The firm maintains its price target of $215.

UBS says Facebook is taking proactive steps to address data protection concerns through business model iteration. However, Facebook does have to deal with longer-term challenges when it comes to the regulation of social media platforms and the collection/use of data.

 
Monday, March 19, 2018, 10:31 AM — by Rob DeFrancesco, TechStock Radar
A New Growth Driver for Broadcom

JP Morgan believes 2018 will be the year that artificial intelligence (AI) starts to become a bigger part of the wired business at Broadcom (AVGO, $250.65).

The firm estimates that the company’s application-specific IC (ASIC) revenue in the AI/deep learning segment (with customers that include Google, Intel and Fujitsu) can reach $1 billion to $2 billion by 2020, up from less than $100 million today.

JP Morgan reiterates its Broadcom price target of $340, saying the ASIC opportunity represents another growth/diversification vector for the company.

 
Monday, March 19, 2018, 10:12 AM — by Rob DeFrancesco, TechStock Radar
Deutsche Bank Downgrades Arista

Deutsche Bank downgrades Arista Networks (ANET, $282) to ‘Sell’ and reduces its price target to $195 from $245.

The firm is more cautious on the company’s beat-and-raise story. Deutsche Bank lowers its sales forecast on Arista after its primary research indicates volatility in product orders.

 
Friday, March 16, 2018, 10:56 AM — by Rob DeFrancesco, TechStock Radar
OpCo Boosts Arista PT to $330

OpCo raises its Arista Networks (ANET, $294.65) price target to $330 from $300 after coming away from management meetings feeling “incrementally positive,” due in part to the cloud unit expected to be the largest vertical again by the middle of the year.

The firm believes litigation risk associated with Cisco Systems (CSCO) is now “minimal” and unlikely to have any material impact on Arista’s business. OpCo calls out the company’s analyst day on May 7 as a potential positive catalyst.

 
Friday, March 16, 2018, 10:23 AM — by Rob DeFrancesco, TechStock Radar
Barclays Trims Apple Estimates

Barclays says a recent visit to smartphone supply chain vendors in Asia revealed a soft sales environment, with limited to zero unit growth expected for 2018.

The firm lowers its Apple (AAPL, $178.75) earnings estimates for this year and next year to reflect weaker iPhone unit sales and ASP. Barclays does not see any signs of a deferred mega cycle in the making either. The firm reduces its AAPL price target to $168 from $170.

 
Thursday, March 15, 2018, 11:49 AM — by Rob DeFrancesco, TechStock Radar
In Focus: Hortonworks

Hortonworks (HDP, $20.32) shares have rebounded 23% from the February 9 pivot low of $16.50. At that low, the stock had corrected 25% from the January 3 high of $22.

Traders sold off Hortonworks shares particularly hard in early February after the provider of data-management software offered below-consensus 2018 revenue guidance of $322 million to $327 million, with the midpoint representing growth of 23.9%.

But the interesting thing is the consensus revenue estimate since then has only come down to $327.6 million from $327.9 million (growth of 25.1%). The Street-high estimate is $340.4 million.

In the February 2018 issue of Tech-Stock Prospector, we called out Hortonworks as a potential takeover target. At the time, the shares were trading at $17.15.

 
Thursday, March 15, 2018, 10:29 AM — by Rob DeFrancesco, TechStock Radar
OpCo Bullish on Apptio

OpCo raises its Apptio (APTI, $30.32) price target to $38 from $30 based on strong Q4 results and positive feedback from its partner checks. Demand is solid for the company’s cloud-based technology business management solutions.

In Q4, Apptio’s revenue growth of 18% accelerated from +16% in the previous quarter.

In 2017, Apptio’s revenue rose 17% to $188.5 million. Top-line guidance for this year of $220 million to $225 million represents accelerated growth of 18% at the midpoint. The consensus stands at $223 million, just above the midpoint.

Apptio went public in September 2016 at $16. The stock this morning hit a new all-time high at $30.49.

 
Wednesday, March 14, 2018, 10:29 AM — by Rob DeFrancesco, TechStock Radar
Nomura Instinet Bullish on Square

Nomura Instinet reiterates its Square (SQ, $54.32) price target of $64 based on a continued mix shift to larger sellers and growing penetration of accretive services (such as virtual terminal, e-commerce and capital).

The firm says international success and the scaling of new services (like banking) would represent incremental upside to Square estimates.

Square shares this morning hit a new all-time high at $54.84.

 
Wednesday, March 14, 2018, 9:54 AM — by Rob DeFrancesco, TechStock Radar
Jefferies Ups Amazon PT to $1,850

Jefferies raises its Amazon (AMZN, $1,598) price target to $1,850 from $1,750, saying the company is aggressively expanding its advertising business (but not at the expense of Facebook or Google).

The firm believes Amazon’s “billions of touch points with consumers and end-of-funnel sales conversion are an advertiser’s dream for targeting and attribution.”

Jefferies argues Amazon has plenty of avenues for revenue to more than double to roughly $500 billion over the next four years, with ad revenue potential of $22 billion in 2022 (up from about $4 billion last year).

 
Tuesday, March 13, 2018, 10:25 AM — by Rob DeFrancesco, TechStock Radar
3 Firms Bullish on Nutanix

Jefferies raises its Nutanix (NTNX, $52.68) price target to $60 from $42, saying management’s new software & support billings target of $3 billion for FY’21 validates the company’s large market opportunity.

Piper Jaffray continues to believe Nutanix is the best positioned hyperconverged vendor in the market. The firm lifts its price target to $57 from $44, noting management’s new long-term operating model, which shows the company expanding operating margin by 400 to 600 basis points over the next few years, with a longer-term target of 25%.

KeyBanc takes its price target up to $61 from $52, citing the growing adoption of Nutanix’s partner ecosystem and new software capabilities as key drivers for the FY’21 billings goal.

Nutanix shares this morning hit a new all-time high at $53.64.

 
Tuesday, March 13, 2018, 10:10 AM — by Rob DeFrancesco, TechStock Radar
KeyBanc Downgrades Alteryx

KeyBanc downgrades Alteryx (AYX, $37.47) to ‘Sector Weight’ with a price target of $39, citing valuation after the sharp rally this year.

Shares of Alteryx—provider of cloud-based, self-serve data prep and analytics platform—recently hit a new post-IPO high of $38.88. So far this year, the stock is up 48%

Alteryx went public in March 2017 at $14, with an opening trade at $17.25.

 
Monday, March 12, 2018, 10:32 AM — by Rob DeFrancesco, TechStock Radar
Deutsche Bank Lifts Microsoft PT to $120

Deutsche Bank lifts its Microsoft (MSFT, $96.51) price target to $120 from $115, saying the Office and Server product segments are doing well, while the Azure business continues its sharp ramp.

The firm sees signs of accelerating overall IT spending growth, which is a big positive for Microsoft.

Microsoft shares this morning hit a new all-time high at $96.91.

 
Monday, March 12, 2018, 10:23 AM — by Rob DeFrancesco, TechStock Radar
Bullish on Broadcom

BMO Capital raises its Broadcom (AVGO, $261.36) price target to $345 from $330 based on increased earnings estimates. The firm says Broadcom’s fundamentals remain strong even though much of the recent investor focus is around the bid for Qualcomm (QCOM).

KeyBanc sees a positive risk/reward balance for Broadcom shares, saying the stock at current levels has effectively priced in a very low probability of a successful acquisition of Qualcomm. The firm maintains its price target of $320.

 
Friday, March 9, 2018, 10:50 AM — by Rob DeFrancesco, TechStock Radar
Stifel & KeyBanc Bullish on Nutanix

Stifel remains upbeat on Nutanix (NTNX, $48.98), reiterating its price target of $52. The firm believes secular tailwinds from hybrid cloud adoption are a major positive for Nutanix.

In addition,  new customer acquisition, expansion within existing accounts, geographic expansion and channel build-out can help the company sustain revenue growth well in excess of 20%, says Stifel.

KeyBanc raises its Nutanix price target to $52 from $44 based on the company’s large-deal potential in Europe. The firm believes Nutanix is increasingly competing on larger deals against incumbent vendors.

Nutanix shares today are rallying 5.7%, and have reached a new all-time high at $49.49.

 
Friday, March 9, 2018, 10:22 AM — by Rob DeFrancesco, TechStock Radar
BofA/Merrill Upgrades CyberArk

BofA/Merrill upgrades CyberArk Software (CYBR, $50.95) to ‘Buy’ with a price target of $60 (up from $51), calling the company one of the strongest vendors in the high-growth privileged account management market, one of the most critical areas of security.

The firm calls out CyberArk’s attractive relative valuation, and thinks the company’s recurring revenue stream is under-appreciated by investors.

BofA/Merrill sees the potential for CyberArk to deliver a CAGR of 20%+ through 2020.

 
Thursday, March 8, 2018, 10:47 AM — by Rob DeFrancesco, TechStock Radar
Security Stocks Showing Strength

Here are today’s new highs in the security sector:

*Proofpoint (PFPT, $120.31)—New all-time high at $121.15
*Varonis Systems (VRNS, $59.22)—New all-time high at $60.05

*Fortinet (FTNT, $52.81)—New all-time high at $53.34
*Palo Alto Networks (PANW, $186.99)—New 52-week high at $188.09

 
Thursday, March 8, 2018, 10:25 AM — by Rob DeFrancesco, TechStock Radar
Goldman Bullish on Microchip Tech

Goldman Sachs upgrades Microchip Technology (MCHP, $95.83) to ‘Buy’ with a price target of $108 (up from $88) based on valuation and the potential upside to earnings growth from the company’s capital allocation strategy.

At the beginning of this month, Microchip announced the $10.1-billion acquisition of Microsemi (MSCC), a specialist in chips for the aerospace/defense, communications, datacenter and industrial markets.

The deal is expected to be immediately accretive to Microchip’s EPS. Microchip anticipates achieving roughly $300 million in synergies in the third year after the close of the transaction.

Previously, Mizuho said it expects the Microsemi acquisition to drive Microchip’s 2019-2020 earnings to the $7-$8 a share range.

Since the deal was announced on March 1, Microchip shares have advanced more than 7%.

 
Wednesday, March 7, 2018, 10:25 AM — by Rob DeFrancesco, TechStock Radar
Nasdaq Market Overview

The Nasdaq Composite—now at 7,362— remains above its upwardly sloping 50-day moving average of 7,202.

Traders are watching last week’s high of 7,438 and low of 7,084 for signs of direction on the next move.

A downtrend line from the late January high of 7,505 runs through the 7,410 level.

 
Wednesday, March 7, 2018, 10:02 AM — by Rob DeFrancesco, TechStock Radar
Two Bullish Views on CyberArk

Piper Jaffray raises its CyberArk Software (CYBR, $49.16) price target to $59 from $53, saying it believes the company is well positioned in the privileged access management market. The firm believes CyberArk’s robust product portfolio creates large cross-selling opportunities.

Needham ups its CYBR target to $57 from $55, calling out several positives: emerging cloud adoption, an improving pipeline, larger deal sizes, broader channel take-up, stronger federal vertical penetration and GDPR tailwinds.

 
Tuesday, March 6, 2018, 10:45 AM — by Rob DeFrancesco, TechStock Radar
Chart Watch: FireEye

Shares of FireEye (FEYE, $17.90) are approaching the 52-week high of $18 from early October. The RSI stands at 74.5.

The 50-day moving average of $15.44 has crossed back above the 200-day moving average of $15.35, reversing the downside crossover from late December.

There’s resistance at $18.42 from July 2016 and $18.73 from April 2016.

 
Tuesday, March 6, 2018, 10:23 AM — by Rob DeFrancesco, TechStock Radar
BofA/Merrill Bullish on NetApp

BofA/Merrill adds NetApp (NTAP, $63.44) to its U.S. 1 List with a price target of $74.

The firm sees continued strength in and conversion to all-flash storage arrays, representing 40% of the product mix at NetApp.

BofA/Merrill also calls out stabilization in the company’s mature revenue base and incremental revenue/margin opportunity with Cloud Data Fabric.

 
Monday, March 5, 2018, 10:07 AM — by Rob DeFrancesco, TechStock Radar
Chart Watch: Intel

Intel (INTC, $48.25) stock has come down from the recent high of $50.90, the second time since January that it failed around that level.

But the shares remain above the 50-day moving average of $45.83. There is short-term support at $46.95.

The 200-day moving average continues to trend upward from $39.87.

 
Monday, March 5, 2018, 9:53 AM — by Rob DeFrancesco, TechStock Radar
Baird Remains Bullish on Apple

Baird remains positive on Apple (AAPL, $174.71), reiterating its price target of $200. The firm cites Apple’s powerful ecosystem and the potential for Apple Watch to continue to gain market share.
 
Friday, March 2, 2018, 12:05 PM — by Rob DeFrancesco, TechStock Radar
Argus Lifts Salesforce PT to $141

Argus raises its Salesforce (CRM, $120.86) price target to $141 from $130, saying the company remains well positioned to take advantage of secular trends toward SaaS cloud solutions, data analytics and platform software services.

Salesforce is successfully gaining market share as it continues to innovate in the enterprise cloud CRM space, according to the firm.

 
Friday, March 2, 2018, 11:55 AM — by Rob DeFrancesco, TechStock Radar
A Strong FQ4 Report Propels Splunk

Shares of Splunk (SPLK, $99.72) today are up more than 6% on better-than-expected FQ4 (Jan.) results.

Revenue of $419.7 million easily beat the consensus estimate of $390.9 million. Top-line growth accelerated to 37% from 34% in FQ3. Billings of $622.8 million were up 44%, acceleration from 38% growth in the previous quarter.

For FQ1, Splunk sees revenue of $295 million to $297 million, above the consensus estimate of $294.7 million.

Needham raises its SPLK price target to $123 from $115, saying the key theme of the quarter was continued year-over-year acceleration in revenue and billings. The firm maintains its view that Splunk remains one of the few open-ended growth stories in tech.

Splunk shares have hit a new 52-week high at $100.40. The all-time high of $106.15 was reached in February 2014.

 
Thursday, March 1, 2018, 10:03 AM — by Rob DeFrancesco, TechStock Radar
Salesforce Delivers Strong FQ4 Results

KeyBanc lifts its Salesforce (CRM, $120.21) price target to $147 from $124 after the company last night delivered strong FQ4 (Jan.) numbers.

Revenue rose 24% to $2.85 billion, above the consensus estimate of $2.81 billion. EPS of 35 cents topped the consensus by a penny.

For FY’19, Salesforce now expects revenue growth of 20% to 21%, an upward revision from earlier guidance calling for growth of 19% to 20%.

Salesforce shares this morning hit a new all-time high at $122.47.

Salesforce is a holding in the Tech-Stock Prospector Vulture Portfolio, added in September 2016 at $74.45.

 
Thursday, March 1, 2018, 9:53 AM — by Rob DeFrancesco, TechStock Radar
BofA/Merrill Bullish on Twilio

BofA/Merrill starts Twilio (TWLO, $34.96) at ‘Buy’ with a price target of $45 based on the bullish thesis that the company has a clear path to $1 billion in revenue by 2021.

In 2017, Twilio’s revenue rose 44% to $399 million.

The firm says Twilio has a comprehensive suite of communication tools, easy API implementation and a strong developer focus.

   
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