Investing.com – Here's a professional summary of the most important pieces of information Wall Street analysts said over the past week.
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Instacart
What happened? On Monday, Needham upgraded Instacart ( Maplebear Inc.) (NASDAQ:) to buy, and add to Condemnation List with a target price of $56.
*Tilder: Needham is optimistic about CART's strong 2024 earnings and customer experience. They expected significant growth in GTV and a compelling risk-reward profile.
What's the full story? Analysts at Needham believe CART's stronger-than-expected 2024 earnings suggest that concerns about competition and the overall drag on the addressable market (TAM) are likely overblown. They attribute this to CART's superior customer experience in the grocery sector, which continues to improve. Needham's cohort analysis suggests that Covid clusters are stable, and that the addition of large clusters post-Covid leads to growth in standardized gross transaction volume (GTV).
Accordingly, Needham's optimistic forecast suggests that CART could deliver low-GTV growth over the next two years, resulting in an adjusted EBITDA compound annual growth rate (CAGR) of 30%. They find the risk-reward profile of CART stock compelling, with an $80 bull case and a floor supported by potential M&A opportunities.
Advanced micro devices
What happened? On Tuesday, Loop Capital initiated coverage on Advanced Micro Devices Inc (NASDAQ:) at Buy with a price target of $175.
*Tilder: AMD shares have underperformed, trading below the SOX. Loop Capital analysts stress computing's accelerating success.
What's the full story? Loop highlights that AMD shares underperformed the SOX in 2024, falling about 18% compared to the SOX's 19% rise. AMD shares currently trade at 24.0x NTM Non-GAAP EPS, which is well below SOX's 29.0x. Analysts note that AMD shares are more in line with peers exposed to mature end markets such as PC, smartphone and industrial sectors.
According to Loop, AMD stock should better reflect its success in accelerated computing, including GPU- and XPU-based data center computing, as well as unique market share expansion opportunities in the general PC and server markets. Analysts confirm that these opportunities have gained great importance recently due to the ongoing challenges facing Intel (NASDAQ:).
Shift group
What happened? On Wednesday, DA Davidson upgraded Shyft Group Inc (NASDAQ:) to buy with a price target of $15.
*Tilder: Davidson upgrades SHYF after investor meetings. CEO Barend Fruthof highlights the benefits of the deal.
What's the full story? Davidson promoted SHYF after meetings with the company's new CEO and investors. The company expresses confidence in the strategic and financial aspects of the Aebi Schmidt deal, which is further reinforced by the stock being down nearly 30% since the downgrade last month, representing an attractive entry point.
Discussions with incoming CEO Barend Fruithof highlight strong customer enthusiasm for the deal. Additional details about synergies and long-term prospects reinforce the company's positive position, shifting the balance of risks and rewards in favor of investors.
Advanced micro devices
What happened? On Thursday, Wolfe Research downgraded AMD to Peer Performance
*Tilder: Wolfe Research sees poor AMD data center GPU performance. CY25 forecast lowered from $10 billion to $7 billion.
What's the full story? Wolfe Research initially highlighted that AMD's data center GPU performance was weak, causing its CY25 forecast to drop from more than $10 billion to $7 billion. The brokerage doubts that AMD will provide CY25 guidance during the Q4 call. After its recent visit to Asia, Wolfe Research expects AMD to face challenges in earnings ahead. The original design manufacturer (ODM) plans to indicate only modest growth from Q4 2024 numbers, and expects data center GPU revenues between $1.5-2.0 billion for Q4 and $7 billion for Q4 2025, which is lower than Previous estimates.
For the first quarter of 2025, Wolfe Research expects $1.75 billion in data center GPU revenue, with steady growth expected for the rest of the year. They expect slow PC seasonality after a strong Q4 (customer down 17% QoQ in Q1), continued weak gaming (-20% QoQ), and no recovery built into the second half of 2025. However Wolfe Research expects the MI350 series to be an important catalyst for AMD in 2H25, with optimism extending into CY26. The MI350 is expected to be a more fundamental redesign than the MI325, primarily improving memory loading.
Cloudflare
What happened? On Friday, City upgraded Cloudflare Company (NYSE:) to buy with a target price of $145.
*Tilder: Citi's bullish view is tied to expected growth.
What's the full story? Citi rates Cloudflare at Buy, citing NET's significant development over the past five years. The bank notes that NET's expansion has gone beyond its core competencies of content caching, web performance and infrastructure protection, as it now provides fast, reliable and secure Internet connectivity through its cloud covering 100 countries and 250 cities. This growth is in its early stages, with Citi optimistic about NET's role in AI development, particularly as AI training moves to AI reasoning. Collaboration with Apple (NASDAQ:) and strengthened executive team boosts NET's prospects.
Citi believes that recent changes in NET's go-to-market strategies have stabilized, paving the way for significant growth. With increased sales productivity and expected revenue growth of 27-30%, Citi sees NET has a clear path to reaching nearly $5 billion in revenue by FY2028.
The bank emphasizes the potential for profitable expansion through expanding free cash flow margin, which supports the strong financial outlook.
