Upgrades and Downgrades; Wall Street analysts have upgraded Ollie, Kroger while downgrading Micron.
Ollie’s Bargain Outlet Holdings
JPMorgan Upgrades Ollie’s Bargain Outlet Holdings
- Upgraded to Overweight.
- Price target: $105.
JPMorgan’s Outlook for OLLI
- Projects a favorable near-term outlook for OLLI due to a robust closeout deal environment, enhanced competitive landscape, and steadfast execution.
- Expects significant acceleration in “organic” unit growth, reaching double digits by FY25 and beyond.
- A 10-year plan to achieve a store count of 1,300 is expected to drive a compound annual growth rate of approximately 13% in Earnings Per Share.
- Potential for lateral consolidation offers opportunities for wallet-driven enhancements to same-store sales and unit growth.
- JPMorgan rates OLLI as Overweight, indicating confidence in the company’s potential for sustained growth and profitability.
- OLLI is well-positioned to capitalize on both organic expansion and strategic consolidation to bolster its market presence and financial performance.
Kroger
BMO Capital Upgrades Kroger
- Upgraded to Outperform
- Targeted $60 price.
BMO Capital Analysts’ Outlook on Kroger Stock Market
- Analysts at BMO Capital report a market pullback due to concerns about rising price investments in the food retail sector.
- The analysts are optimistic about the first quarter internal deliveries, enhancing their forecast to 0.8% from the previous 0%.
- They anticipate an earnings per share of $1.46, surpassing the consensus estimate of $1.35.
- The full-year Fiscal Year 2025 earnings forecast assumes an almost unchanged gross margin percentage excluding fuel and stable retail fuel CPGs.
- The analysts foresee a favorable outcome regardless of a deal, increasing the EPS estimate to $4.49 and $4.65.
- The primary risk identified is the potential for price investments driven by an intensifying competitive environment in the food retail sector.
- Kroger’s stock closed at $51.98, a gain of 1.82% from the prior day’s regular close.
iRhythm Technologies
Wolfe Research Upgrades iRhythm Technologies
- Upgraded to Outperform
- Price target: 115
Wolfe Research Upgrades IRTC Stock
- Wolfe Research upgrades IRTC’s stock from $98 to $115 due to a sensible entry valuation.
- The analysts anticipate a key overhang to be resolved within the next 12 months, leading to a target price of $115.
- The target price is supported by a DCF analysis and an EV/revenue comparison, suggesting $115 is roughly 5 times the projected 2025 revenue.
- Wolfe argues that a premium of 5x is justified for the equity due to IRTC’s expected high-teen percentage revenue growth for the next year.
- The DCF analysis indicates a NPV consistent with the $115 target, using a 9% discount rate and a 5% terminal growth rate.
Goodrx Holdings Inc
Aletheia Capital Downgrades Micron
- Micron Technology Inc downgraded to Hold.
- No price target set.
Aletheia Capital Downgrades Micron to ‘Hold’
- Micron’s stock has seen a 2.1x increase since November 2023, trading above its historical 2.5x PBR.
- Aletheia Capital identifies teething issues with MU’s HBM3E execution, potentially impacting near-term revenue target and profitability.
- The research team withdraws the previous $500 million HBM revenue projection for FY24E.
- Aletheia Capital suggests MU needs to significantly increase its capital expenditure to expand capacity in FY25E/26E.
- Despite positives like the upward trend of memory Average Selling Price, strong demand for HBM from AI servers, upward earnings revision, and positive FCF, the stock closed at $139.54.
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