Premarket Winners and Losers
U.S. futures were steady Friday as investors anticipated the monthly employment data for signs of interest rate decreases.
Today’s largest premarket U.S. stock moves:
Top Gainers
Equitrans Midstream (NYSE:ETRN) rose 8.5% after energy giant EQT (ST:EQTAB), which fell 5.2%, said that it will purchase back its former pipeline subsidiary in an all-stock transaction.
Choice Hotels (NYSE:CHH) International shares surged 7.4% as the hotel chain ended its months-long acquisition effort for competitor Wyndham Hotels & Resorts (NYSE:WH), which fell 3.3%, after failing to get sufficient shareholder backing. Choice also announced an increase of 5 million shares in its repurchase program.
Coinbase (NASDAQ:COIN) shares surged 6.4% as the cryptocurrency exchange benefited from bitcoin, the most popular digital currency, reaching a new record high.
Netflix (NASDAQ:NFLX) stock rose 0.5% after Oppenheimer raised its price target for the streaming giant from $615 to $725 while maintaining a ‘outperform’ rating, citing a push to implement stricter password sharing rules, introduce advertising, and optimize subscriber plans as key drivers of revenue growth this year.
Duolingo (NASDAQ:DUOL) stock rose 1.3% after JPMorgan initiated coverage of the popular language-learning platform with a ‘overweight’ rating, highlighting its strong market position with 88.4 million monthly active users and 26.9 million daily active users, representing approximately 5% of the estimated 1.8 billion global language learners.
Top losers
Boeing (NYSE:BA) stock slumped 2.3% after the Wall Street Journal reported that the US Justice Department has launched a criminal investigation into a deadly mid-air fuselage break on one of the company’s 737 Max planes flown by Alaska Airlines in January.
Adobe (NASDAQ:ADBE) shares dipped 0.8% after BMO Capital Markets withdrew the computer software business from its top choice list, citing a growing competitive threat.
Nvidia (NASDAQ:NVDA) shares dipped 0.9% on Friday, as semiconductor stocks lost some impetus following a rapid runup
AI Stocks in focus
Buy Apple before GTC, cut Nvidia – Lynx analyst
A Lynx Equity Strategies analyst advised investors on Friday to purchase Apple (NASDAQ:AAPL) and sell Nvidia (NASDAQ:NVDA) before the GPU Technology Conference (GTC) later this month.
He challenges the idea that Apple and Google (NASDAQ:GOOGL) should only finance existing AI champions like Nvidia and AMD (NASDAQ:AMD) to widely embrace AI.
He stresses that Apple and Google must participate in the AI revolution to expand globally.
Perhaps they’re behind that ball. Can investors gamble that AI may make substantial inroads in global applications backed by one hyperscale cloud provider, MSFT? The analyst wrote.
No doubt, the AI revolution is coming. Our daily lives will include it. We’re just complaining about the time and resources needed to globalize the revolution.
“AAPL and GOOG are needed for the revolution to happen on time. If they lag, so be it, they said.
Broadcom should accelerate in 2H24, say BofA.
After Broadcom’s fiscal Q1 2024 report, Bank of America analysts maintained a Buy rating and boosted the price target from $1,500 to $1,680.
Analysts expect AVGO’s non-AI semiconductor sales, especially broadband, to bottom out in the first half of the year.
They predict second-half revenues to rise double-digits by the fourth quarter and into the 2025 fiscal year.
We expect AI sales (already over 30% of semis) to expand 20-25% with additional high-speed switches. Analysts predict VMWare will end this year with ~$4bn, indicating a >10% YoY growth trajectory until FY25.
They said Meta (NASDAQ:META) is a major supplementary ASIC customer for AVGO, in addition to its strong position at Google.
Melius Research expects AMD PT to rise.
Although AMD has been a popular AI stock selection over the last year, Melius Research analysts think it has more to give.
The broker boosted its chipmaker expectations due to stronger data center prospects. The price objective rose from $192 to $265.
AMD’s MI300X AI processor should benefit from AI’s “inferencing phase” which requires high-bandwidth memory. Melius predicted a rise in high-bandwidth memory supply in each quarter this year for this phase.
With Microsoft (NASDAQ:MSFT) as an anchor and other clouds taking up, AMD can create greater AI upside vs. earlier projections (we upped 2x in 2024), experts said.
Tests show that conventional server CPU sales are rising with better foundations and execution. Repeat Buy Rating,” they said.
ARM, NVDA, AMD, and AVGO price targets raised by Mizuho.
Mizuho Securities analysts took a longer-term view on AI and custom silicon on Wednesday, stressing Arm’s development into Mobile and Data Center (Infrastructure).
Analysts believe Arm’s stock has further growth potential despite its strong post-IPO performance. Mizuho boosted their ARM price target to $160 from $100, a 20% increase from current levels, “given further custom silicon/mobile upside,” analysts said.
“While ARM has a lockup expiration coming up 3/12, we continue to see strategic investors owning ARM given its attractive long-term roadmap,” Mizuho noted.
In addition, the firm raised its price estimates for Nvidia, Broadcom, and AMD to $1,000, $1,550, and $235.
“NVDA remains the biggest near-term AI winner, with AMD and AVGO also major beneficiaries,” analysts added.
Palantir’s AIP platform facilitates AI use cases, according to Wedbush. The analyst raised their price objective for Palantir (NYSE:PLTR) to $35 from $30 earlier this week.
The analyst wrote that the big data analytics software maker’s latest evaluations have turned increasingly positive due to beliefs that its Artificial Intelligence Platform (AIP) foundation “is becoming viewed by many US enterprises as the “launching pad of AI use cases”.”
They added that Palantir’s flagship AIP platform and myriad of customer bootcamps are well-positioned to monetize a tidal wave of enterprise spend hitting the tech sector as the AI Revolution enters the key use case and deployment stage.
The analyst stated that Palantir, termed “Messi of AI” at Wedbush, may capture a major piece of the predicted $1 trillion AI Global Total Addressable Market (TAM) due to its extensive product range and AI capabilities.
This assumption is based on corporate and government ecosystems’ growing embrace of efficient technologies to automate complex procedures.
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