4 big analyst cuts: Dell's AI not enough to fight off macro troubles, per Barclays
By Davit Kirakosyan
Here is your Pro Recap of the biggest analyst cuts you may have missed since yesterday: downgrades at Dell, Crocs , and Verint Systems , and initiation with Underperform rating at Cloudflare.
InvestingPro subscribers got this news first. Never miss another market-moving headline.
Dell falls on Barclays downgrade
Dell Technologies (NYSE:DELL) shares fell some 3% before the bell Thursday after Barclays downgraded the company to Underweight from Equalweight with a price target of $53.00, as reported in real time on InvestingPro.
Barclays cited the recent surge in Dell's stock price in its decision, which the analysts say has brought the stock's valuation out of near- and long-term trading ranges.
The analysts also note that they "see challenges in the PC and Server/Storage end markets on challenging macro, and don’t think AI will be enough to offset these pressures."
Dell shares were recently changing hands at $68.40 in Thursday's premarket.
Cloudflare started at Underperform
BofA Securities initiated coverage on Cloudflare (NYSE:NET) with an Underperform rating and a price target of $52.00. As a result, shares fell more than 3% pre-market today.
The bank noted that while Cloudflare excels in web delivery and web security, the company faces two key challenges: softening demand from enterprise clients and convincing customers to adopt new solutions like Zero Trust and Edge Compute.
We believe that the challenges to address the enterprise market could translate into lower estimates than the Street anticipated, and our CY24 billings growth estimate of 27% is slightly lower than the Street’s 29%.
Two more downgrades
Crocs (NASDAQ:CROX) shares fell more than 2% pre-market today after B.Riley downgraded the company to Neutral from Buy and cut its price target to $101.00 from $125.00.
The firm cited concerns about excess footwear inventory in stores and warehouses, anticipating that the sales cadence of footwear/apparel/accessories will likely slow/turn negative year-over-year on a nominal basis in September/through the remainder of 2023.
Oppenheimer downgraded Verint Systems (NASDAQ:VRNT) to Perform from Outperform.
Shares dropped more than 17% pre-market today following the company’s reported Q2 EPS and revenue miss and disappointing full-year guidance.
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