Daily Update - February 2, 2023

Selected highlights of the day

By: Matthew Otto

Meta Platforms

Disclosed their fourth quarter financial results, outlining a new goal of efficiency for 2023. To back this ambition up and show commitment to its shareholders, Meta recently announced 11,000 job cuts as well as further spending reductions. Additionally they launched a stock buyback program with an authorization of $40 billion – the largest in company history – along with over $10 billion left from prior repurchase programs showcasing optimism amidst current challenges.

Wall Street Action

Most analysts have raised their price target for Meta Platforms,

  • Canaccord Genuity’s Maria Ripps increasing her to $220.
  • JMP Securities’ Andrew Boone raising his target price from $150 to $210.
  • Oppenheimer’s Jason Hellfstein upgraded his price target from $145 to $220.
  • Morgan Stanley’s Brian Nowak pushed his stock forecast from $130 to $190
  • Colin Sebastian at Baird raised his from $145 to $205.
  • Credit Suisse analyst Stephen Ju increased his original price object of $180 to $220.
  • Rosenblatt Barton Crockett kept his Neutral rating and a $116 price target.
  • Mizuho James Lee raised to $210 from $170.
  • Evercore ISI Group’s Mark Mahaney kept Meta with an Outperform rating while  increasing the price target from $170 to $275.
  • JP Morgan analyst Doug Anmuth maintained his Overweight rating while raising the price target  to $225.
  • UBS analyst Lloyd Walmsley kept a Buy rating and increased his price target to $235.
  • Barclays’ Ross Sandler preserved his Overweight recommendation.
  • B of A Securities Justin Post changed his Neutral rating to a Buy and set a target price of $220.
  • Raymond James’ Aaron Kessler upped his price target to $220 with an Outperform rating.
  • Bernstein’s Mark Shmulik raised his stock forecast from $170 to $210 while maintaining outperforming rating.
  • Stifel analyst Mark Kelley raised from $180 to $210 and stayed with a Buy rating.
  • Guggenheim’s Michael Morris and Jefferies’ Brent Thill both uphold a ‘Buy’ rating.
  • Susquehanna analyst Shyam Patil maintained his Positive rating and raised his price target from $140 to $225.
  • John Blackledge of Cowen maintains a Market Perform rating.
  • Truist Securities Youssef Squali set his stock forecast  at $215 with a Buy recommendation.
  • Wolfe Research Deepak Mathivanan upped his target price from $150 to $220 with keeping an Outperform rating.
  • Piper Sandler Thomas Champion changed his Neutral rating into Overweight and upgraded his price target from $135 to $215.
  • Wells Fargo analyst Brian Fitzgerald maintained Meta Platforms with a Overweight and raisds the price target from $165 to $250.

 

Peloton’s eighth consecutive unprofitable quarter

Narrowed from a year ago, with the company reporting their net loss at $335.4 million and 98 cents per share as opposed to a loss of $439.4 one year prior – pointing towards possibly becoming a ‘turning point’ according to CEO Barry McCarthy who formerly worked for Spotify and Netflix. Revenues reported were above expectations at $792.7 million compared to analysts projected estimates of $710 million; emphasizing that subscribers continue to favor connected fitness products over other options available on the market.

Peloton’s connected fitness products achieved impressive growth this quarter, with a 10% jump in total members and 3.03 million subscriptions compared to the same period last year. Its subscription sales bore fruit as well, boasting 67.6% gross margins despite having 11.2% negative margin on bike/tread machines – resulting in an overall gross margin of 29%, up from 24%. The company also declared its ambition to increase signups by one million over the next twelve months through promotional activities such as those seen during the holidays season.

  • Citigroup analyst Ronald Josey and Barclays analyst Mario Lu both increasing their price targets to $22 and $19 respectively while maintaining a ‘Buy’ rating.
  • Credit Suisse’s Kaumil Gajrawala raised his target from 10$ to 12$, albeit still carrying the stock at Neutral rating.
  • Truist Securities’ Youssef Squali increased his price object from 14$ to 15$ but retained a Hold recommendation.
  • Baird’s Jonathan Komp maintained a Neutral rating despite upping his price target from $12 to $14.
  • JP Morgan’s Doug Anmuth maintained an Overweight view while lifting his price target from $13 to $19.
  • Piper Sandler Edward Yruma kept his Neutral rating whilst raising the stock  forecasts from $12 to $17.
  • BMO Capital analyst Simeon Siegel’s retained an Underperform rating and price target to $9.5.
  • Roth Capitals George Kelly maintains a Buy ratings and a $20 target price.
  • Canaccord Genuity’s Michael Graham increased his price target from $15 to $20.
  • B of A Securities’ Justin Post raised his stock forecast from f $16 to $19.
  • Bernstein analyst Aneesha Sherman set a $20 price taregt.
  • Exane BNP Paribas’ Laurent Vasilescu lowered expectations after downgrading from Neutral to Underperform rating.
  • JMP Security Analyst Andrew Boone had a Market Perform ratings.

EAT

  • Barclays’ Jeffrey Bernstein set a target of $36
  • Wedbush Nick Setyan had a higher price target at $42.
  • Citigroup’s Jon Tower maintains a Neutral rating and increases his price target from $39 to $40.
  • Raymond James’ Brian Vaccaro kept his Outperform recommendation while raising the stock forecast up to $46.
  • BMO Capital Markets Andrew Strelzik maintained an Outperform rating and a $45 price target.
  • JP Morgan John Pitzer held his Overweight rating and increased the price target from $37 to $41.

Despite warning that its restaurants may have lost some market share during the fiscal second quarter, Brinker still experienced strong financial performance by comfortably beating analysts’ expectations in terms of adjusted earnings per share (76 cents) and revenue ($1.02 billion).

QRVO

Qorvo’s financial performance in the third quarter of 2023 was a total loss of $15.9 million and earnings per share at 16 cents, which did not meet analysts’ expectations by 46 cents on revenue. On both GAAP & non-GAAP basis Qorvo witnessed a decline compared to their previous quarters; however they still managed to maintain an impressive gross margin percentage rate (36.1%/40.9%) along with operating income ($09/$99). Looking ahead into the March Quarter, Qorvo projects its quarterly revenue between 600 – 640 million while maintaining Non-GAAP diluted EPS from 10- 15 cents range.

  • Craig-Hallum’s Anthony Stoss set a price target of $130.
  • Morgan Stanley’s Joseph Moore kept his stock forecast at $110 and an Equal-Weight rating.
  • Fargo analyst Gary Mobley set his price objective at $110.
  • Piper Sandler analyst Harsh Kumar kept an Overweight call on Qorvo coupled with a price mark of $120.
  • Needham’s Rajvindra Gill held a Buy rating and a $130 price target.
  • Cowen & Co.’s Matthew Ramsay retained a Market Perform rating but still boosted price target from $80 to $100.
  • Susquehanna Christopher Rolland maintained his Neutral rating while raising his price target from $95 to $100.
  • Mizuho analyst Vijay Rakesh remained at a Neutral rating and revised the price target from $93 to $100.

 

IDEX

Corporation achieved both a successful fourth quarter and full year of 2022, marked by record-breaking results. Specifically reported diluted EPS for the fiscal 2021 was $1.71, up 10%, as well adjusted EPS grew 18% to $2.01 from the previous period’s numbers; this coincided with an income margin that decreased 60 basis points to 16%. On top of these impressive quarterly figures, IDEX reached peak performance over the past twelve months – achieving an astounding 31% increase in reported EPs ($7.71) and 5% organic growth in orders (for total figure reaching a staggering 3 billion). As such Net Income Margin rose 210 basis points throughout FY2021 resulting in overall success for IDEX Corporation.

  • Mizuho’s Brett Linzey assigned a Neutral rating and raised the price target from $225 to $227.
  • Oppenheimer analyst Bryan Blair upgraded his own forecast by increasing it from $245 to $247 while maintaining an Outperform rating.
  • Baird’s Michael Halloran ramped set a $255 price target and an Outperform rating.
  • Citigroup Vladimir Bystricky reduced his stock forecast from $273 down to $268.