While the Tesla stock split took center stage for Thursday’s news cycle, markets were still trying to figure out a definitive direction. After a few recent down days, analysts may have chalked July’s bounce as just a bear market rally and not a true recovery. Regardless of the direction of the macro, one major Wall Street firm has a few ideas that can stand up in the near term and the long term.
Recessions and bear markets tend to weigh on tech stocks the most, and these are some of the hardest hit during downturns. As such, some analysts have cut their targets across this sector. However, one major brokerage house on Wall Street actually is raising its targets for a select few tech stocks.
Cowen issued calls across multiple industries within the tech sector where it sees significant potential upside. Considering the inflationary climate, finding upside is key to keeping pace with the recovery from the market lows this summer.
It is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.
Cowen reiterated an Outperform rating on NetApp Inc. (NASDAQ: NTAP). Its $93 price target implies upside of 28% from the most recent closing price of $72.82.
The most recent results reaffirmed Cowen’s positive view on NetApp. While the fiscal 2023 guidance was reiterated, the brokerage firm thinks currency headwinds and a cautiously optimistic demand environment refrained management from being more bullish.
NetApp stock was last seen trading near $78, in a 52-week range of $61.26 to $96.82. Shares are actually down 21% year to date, excluding Thursday’s move.
Cowen reiterated an Outperform rating with a $200 price target for Nvidia Corp. (NASDAQ: NVDA). The implied upside from the most recent closing price of $172.22 is 16%.
The analyst noted that the price target might be range-bound in the near term. The recent gaming inventory and crypto correction have been painful but necessary and may even be welcome. However, despite strong upcoming Lovelace and Hopper product launches in Gaming and Datacenter, respectively, Cowen decidedly left this call with the same feeling as when it entered it: “just enough nitpick doubts in Datacenter to prevent the ‘all clear’ for the stock.”
Nvidia stock was last seen trading near $170, in a 52-week range of $140.55 to $346.47. Shares are actually down 41% year to date.
On Salesforce Inc. (NYSE: CRM), Cowen reiterated an Outperform rating but it lowered the $225 price target to $210. That still implies upside of 17% from the most recent closing price of $180.01.
Overall, Salesforce reported a good second quarter, with current revenue performance obligation growth of 19%, above the guidance of 18%. As expected, management called out growing macro headwinds developing late in the quarter that are anticipated through year’s end. Cowen noted that what was a surprise in the report was the degree of cutting to both second-half revenue and free cash flow growth expectations.
Shares of Salesforce recently traded near $166 in a 52-week range of $154.55 to $311.75. The stock is down about 29% year to date, excluding Thursday’s move.
The Outperform rating on Snowflake Inc. (NYSE: SNOW) was reiterated, but Cowen raised its $230 price target to $235. The implied upside from the most recent close at $159.49 is 53%.
Snowflake reported a strong second quarter. Product growth of 83% was decently above Cowen’s 72% estimate. Ultimately, this was the largest beat in three quarters, and fiscal 2023 guidance was slightly raised. Performance was strong in both corporate and enterprise and across all areas. The company is seeing strengthening consumption trends, bucking the bear narrative and showing that recent growth drags were one-time, according to Cowen.
Shares of Snowflake recently traded near $189, in a 52-week range of $110.26 to $405.00. The stock is down about 53% year to date, excluding Thursday’s move.
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