Now that 2020 is well underway, investors should already be looking past the 2019 mega-gains of 28.9% in the S&P 500 and closer to 35% for the Nasdaq. The base case is for the major stock indexes to generate returns of about 7.4% in 2020, but there still is a case for stocks to climb 10% to 12% if certain things come about in 2020. The phase-one trade pact with China already has played into the potential upside scenario, but now many companies are going to have to play a direct role in the stock market’s gains for 2020.
24/7 Wall St. covers dozens of analyst calls each day of the week, and that becomes hundreds of analyst calls over the course of most weeks. It turns out that, at the start of 2020, analysts are rapidly hiking their ratings and price targets on a group of leading technology stocks. This matters because it generally implies that the analyst community is generally not worried about how these companies will act after they start reporting earnings and issuing 2020 guidance over the last half of January.
There are many reasons to continue being bullish about the major technology leaders in 2020 and perhaps beyond. The tech-heavy Nasdaq already has seen a gain of nearly 5% so far in January. The iPhone supercycle is one catalyst, there is a new slate of game consoles coming late in the year, global growth appears to be more stable than just a few months ago, China is playing nice again, the cloud is still a fraction of its potential, and so on. There are also still many risks that have to be considered, before and beyond the upcoming election cycle that comes to a head this November.
Of course, it is impossible to determine which companies will beat earnings expectations and which will issue upside guidance for all of 2020. That said, when you see more than one or two analysts issuing formal upgrades or handily raising their target prices for the year ahead, it should stand out as more than just a trend.
These are not the only tech stocks and tech leaders that have seen analyst upgrades or target price hikes from Wall Street over the past month. They just happen to be the largest and all have high profiles and have seen major gains over time. Consensus analyst target price data comes from Refinitiv, and other color has been provided as well.
Here are the 10 top tech leaders that have scored major analyst price hikes and ratings upgrades from the latter half of December and into January.
Adobe Inc. (NASDAQ: ADBE) doesn’t seem to be a major tech stock that dominates the news headlines, but the shares have risen more than 200% in the past three years or so. With a new all-time high going above $350 per share, the consensus target price was $352.67.
- Oppenheimer raised Adobe to Outperform from Perform and set a $410 target price on January 17, 2020.
- Wells Fargo reiterated its Equal Weight rating but raised its target to $345 from $315 on January 16.
- Credit Suisse reiterated an Outperform rating and raised its price target to $385 from $350 on January 13.
- Jefferies reiterated a Buy rating and raised its price target to $390 from $370 on January 9.
- Barclays reiterated a Neutral rating with a $330 price target on December 16, 2019.
- Argus reiterated a Buy rating with a price target of $368 on December 16.
- Canaccord Genuity reiterated a Buy rating and raised its target to $350 from $320 on December 13.
- Nomura/Instinet reiterated a Buy rating and raised its target to $318 from $300 on December 13.
Advanced Micro Devices Inc. (NASDAQ: AMD) has managed to shed its past woes and is winning more share in the processor market and doing well in graphics. AMD shares just hit a new all-time high above $51 and have passed the prior zeniths of 2000 and 2005, when the shares challenged the $40 level. It seems impossible to believe that AMD was a mere $2 stock in 2015. AMD’s consensus target was most recently seen down at $41.60, but that is still higher than the $37.77 consensus starting the new year.
- On January 21, Cowen reiterated its Outperform rating and raised its target to $60 from $47, noting that AMD was taking market share and was better positioned against Intel for more gains.
- Mizuho upgraded it to Buy from Neutral and raised its price target to $55 from $38 on January 9.
- Wells Fargo reiterated an Overweight rating and raised its price target to $55 from $48 on January 7.
- Nomura reiterated a Buy rating and raised its price target from $40 to $58 on January 2.
- Rosenblatt reiterated a Buy rating and raised its target to $65 from $52 on AMD on December 31.
- RBC Capital Markets reiterated it as Outperform and raised its target to $53 from $50 on December 24.
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