7 Key Tech Stock Upgrades for Big Implied Upside

Print Email

Nokia

On May 25, CLSA raised Nokia Corp. (NYSE: NOK) to Outperform from Underperform. The stock closed up 2.7% at $5.36 the prior day, and the American depositary shares were up at $5.60 as Friday trading came to a close in New York. Just the prior week, Nokia was upgraded to Buy from Hold at Canaccord Genuity, along with a $7 price target. Its consensus analyst target of $6.81 rose to $6.91 after this call. Nokia has a 52-week range of $5.08 to $7.63.

Stratasys

As part of a positive call this week for 3D printing, Stratasys Ltd. (NASDAQ: SSYS) was given a brighter view than was offered up for its competitors. The stock was started as Outperform and assigned a price target of $29 at FBR Capital Markets on May 24. The prior close was $20.46. The consensus price target was $24.46 going into that call, and that target was up at $24.79 at the end of the week. The 52-week range is $14.48 to $39.45.

Universal Display

Universal Display Corp. (NASDAQ: OLED) saw two calls this week. It was raised to Buy from Neutral with a $76 price target at Goldman Sachs on May 23. Then on May 25, it was reiterated as Buy at Needham, but the price target was raised to $69 from $62. The share price was $64.39 before the second call, and shares closed at $67.78 on Friday afternoon. What matters here is that Universal Display traded at $56.41 the previous Friday, with more hope of winning from Apple (something we have spoken of before).

Western Digital

After earnings, with guidance that was deemed conservative, Western Digital Corp. (NASDAQ: WDC) traded up marginally. It received calls ahead of and after earnings. Jefferies maintained it as Buy on May 24, but the price target was cut to $50 from $56, versus a $40.46 prior close. Then Jefferies raised that target back up to $54 after the earnings on Friday. Cowen raised its rating to Outperform from Market Perform with a $50 price target. On May 25, the stock was raised to Overweight from Equal Weight at Barclays. For a call on the other side: Morgan Stanley trimmed its target to $48 in its call.

Western Digital’s guidance was updated for its SanDisk acquisition. The company said:

Western Digital now expects its fourth quarter revenue in the range of $3.35 billion to $3.45 billion compared to its earlier forecast of $2.6 billion to $2.7 billion. The company now expects its fourth quarter EPS on a non-GAAP basis to be between $0.65 to $0.70, compared with its earlier forecast of $1.00 to $1.10 per share. The new guidance includes total interest costs of approximately $220 million, which includes interest expense on newly issued debt of approximately $185 million and amortization of debt issuance costs of approximately $30 million. Interest expense on the newly issued debt includes approximately $50 million incurred prior to the deal closing date. Due to the impact of the interest expense, the company estimates a non-GAAP tax benefit of approximately $15 million for the quarter. Diluted share count for the quarter, including shares issued to SanDisk shareholders as of May 12, 2016, is expected to be 266 million, equivalent to 290 million shares on a full quarter basis.

Western Digital shares were trading at $44.99 on Friday’s close. Its consensus analyst target is $59.26, and the 52-week range is $34.99 to $99.76.

I'm interested in the Newsletter
 

Instructure

Instructure Inc. (NYSE: INST) provides cloud-based learning management platform for academic institutions. It was reiterated as Outperform with a $27 price target (versus a $16.99 close) at Oppenheimer on May 25. Investors liked what they heard here, because the stock coincidentally rose by 6% to $18.25 shortly afterward. The stock closed at $17.45 on Friday, and its post-IPO range was $13.21 to $23.63.