Amazon headed for rosy period, says HSBC; Roku flying: 6 big analyst picks
Investing.com — Here is your Pro Recap of the biggest analyst picks you may have missed since yesterday: upgrades at Amazon, Roku , Amgen, Chevron , Clorox, and TTM Technologies.
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Amazon started with Buy at HSBC
HSBC initiated coverage on Amazon.com (NASDAQ:AMZN) with a Buy rating and a price target of $160.00, as reported in real time on InvestingPro.
The analysts wrote that despite Amazon’s underperformance compared to the S&P 500 for the last two years, the online retailer behemoth is expected to emerge from this phase as it capitalizes on previous investments and shifts its focus back to profitability. The analysts anticipate an improvement in e-commerce margins to levels seen in 2019, as well as strong growth in advertising, expected to rise by 24% to $46 billion in 2023.
HSBC expects Amazon’s earnings before interest, taxes, depreciation and amortization (EBITDA) to grow at a 30% compound annual growth rate (CAGR) from 2022 to 2025, supported by around 12% organic revenue growth and an annual margin increase of about 150 basis points.
Shares were recently up 0.5% to $137.73.
Roku raised to Hold following Q3 earnings
Pivotal Research upgraded Roku (NASDAQ:ROKU) to Hold from Sell and raised its price target to $75.00 from $58.00 on Q3 earnings, which prompted shares to catapult some 30% in recent trading.
The analysts noted that the results showed in-line net new active account growth as well as better-than-expected revenue, gross margin, and EBITDA.
The analysts anticipate that Roku will likely exceed its typically conservative Q4 guidance and has a high chance of meeting its 2024 positive EBITDA targets, possibly even achieving positive free cash flow that year without compromising on product investment.
Shares were recently changing hands at $77.41.
Truist upgrades Amgen to Buy
Truist upgraded Amgen (NASDAQ:AMGN) to Buy from Hold with a price target of $320.00 (from $260.00), citing the biotech's commercial execution and "ability to grow mid-cycle assets" to achieve record sales, "despite underwhelming initial launches."
Truist also wrote that Amgen's "investment in derm and primary care sales force and DTC [direct to consumer] could continue to grow the topline," and noted further catalysts in GLP-1/obesity data.
Shares were adding 2.2% to $266.68.
Chevron upgraded to Outperform
Bernstein upgraded Chevron (NYSE:CVX) to Outperform from Market Perform with a price target of $182.00 (from $184.00) following the company’s announced Q3 results last week.
The analysts highlighted several key factors for the upgrade, including a cleanup in the Permian Basin and an expected increase in volumes in Q4 despite previous issues. They also noted a cautious stance on capital expenditure for the mature Tengiz project in Kazakhstan, suggesting a conservative outlook.
The analysts continued:
"Refining reversals. Much of the miss was timing and in which quarter the value is accounted for is less critical for us. Joining the HES fan club. We're card carriers and as CVX communicates the value of HES growth to its value oriented shareholders, more will join. We expect geopolitical tensions wane and a return of CVX Israeli gas."
Earlier this week, Chevron was also upgraded by BofA Securities, which moved its rating from Neutral to Buy with a price target of $200.00 (from $190.00).
Shares were up 1.8% to $146.54.
Clorox upped to Buy
Citi upgraded Clorox (NYSE:CLX) to Buy from Neutral and raised its price target to $150.00 from $135.00 following the company’s surprise Q1 beat, with analysts saying they view the recent devastating cyberattack on the company as a "one-time negative impact" that it is already starting to "wipe off."
The analysts specifically pointed out that Clorox posted Q1 results that surpassed the guidance set after the August attack. Despite a forecasted dip in fiscal 2024 guidance to account for the impact of that event, including a mid-high single-digit percentage decline in sales and EPS in the range of $4.30-$4.80, the analysts believe the revised guidance reflects a healthy dose of conservatism both on the top line and margin front.
Clorox shares were lately up 7.8% to $124.32.
TTM Tech raised to Buy
TTM Technologies (NASDAQ:TTMI) shares rose nearly 2% pre-market today after Truist Securities upgraded the company to Buy from Hold and raised its price target to $16.50 from $16.00.
This move follows the company's reported better-than-expected Q3 results, which led to more than a 12% jump in its stock price Wednesday.
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