If you ever wondered if collusion exists on Wall Street, Wednesday’s varying reports on different semiconductor companies might be enough to make you wonder. A select number of semiconductor stocks are surging higher on Wall Street analysts’ research reports, even as the broad market has sold off. They may even be responsible for saving the Nasdaq from suffering larger losses and profit taking as well.
We have identified several of the key calls from Wednesday that are driving the chip stocks higher.
Marvell Technology Group Ltd. (NASDAQ: MRVL) was up more than 2.8% at $15.25 in mid-day trading on Wednesday, in a 52-week range of $10.82 to $16.65. The chip designer was raised to Buy from Neutral with a $19 price target at Nomura. Marvell’s consensus price target was $16.82. The call is based on a more cost efficient system-on-a-chip portfolio for LTE, and the report calls Marvell’s strength against competition better than it was before.
Micron Technology Inc. (NASDAQ: MU) was raised to Buy at Bank of America Merrill Lynch, but the upgrade was all the way from an Underperform rating. Perhaps the biggest news was that Micron’s price target was raised to $40 from $32 in the call. This was based on Micron having a sustainable upturn, a lower threat from Samsung, new technology execution and a dividend payment.
Another positive research call for Micron came from Credit Suisse, which reiterated its Outperform rating. This call brought on a massive upside target though to $50 from $30. The firm’s upgraded target was based on strong demand trends from consumer and enterprise.
SanDisk Corp. (NASDAQ: SNDK) was raised to Buy at Merrill Lynch, also from Underperform. The firm’s price target was raised to $125 from $80 in the call. Merrill Lynch had been positive before, but it had exited its prior Buy rating after a large run up in the stock. Its new positive bias was based on stronger earnings momentum and solid shareholder return, plus a lower Samsung threat.
Micron shares were up 5.45 at $31.10 mid-Wednesday and hit a new high of $31.16 on the day. SanDisk shares were up 3.5% at $100.50, also hitting a new high of $100.61.