Here is your Pro Recap of the biggest analyst picks you may have missed since yesterday: upgrades at Amazon, Roblox, Marqeta, and Kornit Digital.
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Amazon earns another upgrade following Q2 beat
PhillipCapital upgraded Amazon.com (NASDAQ:AMZN) to Buy from Neutral and raised its price target to $175.00 from $120.00, as reported in real-time on InvestingPro.
Amazon expects the trend of customers shifting their focus towards innovation and new workload deployments to continue into Q3/23 and anticipates the optimization efforts to ease further, suggesting that growth has bottomed out. According to PhillipCapital, there's a possibility for a renewed re-acceleration in the latter half of 2023, especially during Q4. This perspective is based on Amazon's launch of its new AI services and the gradual uptick in customer spending on AWS.
Earlier this month, the company saw upgrades from two other Wall Street firms, Exane BNP Paribas and Rosenblatt.
The rating changes were made following the company's Q2 results, which exceeded Street estimates and included upbeat Q3 guidance, driven by the cloud business growth that surpassed expectations.
Roblox earns two upgrades following disappointing Q2
Roblox (NYSE:RBLX) shares rose more than 2% premarket today after receiving upgrades from two Wall Street firms.
Morgan Stanley upgraded the company to Equalweight from Underweight and raised its price target to $30.00 from $26.00.
While 2Q results were mixed, we believe that shares now fairly reflect the near term headwinds (e.g. 2H:23 bookings deceleration), balanced against the longer term opportunities to drive growth and operating leverage (e.g. AI tools and ads).
Meanwhile, Wedbush upgraded the company to Outperform from Neutral with a price target of $37.00.
The company fell short of Q2 estimates on Wednesday due to declining demand for its online games and increased competition. This resulted in more than a 22% drop in share price, wiping out almost all the gains made this year.
Marqeta upgraded following Q2 earnings and the Cash App deal
Berenberg upgraded Marqeta (NASDAQ:MQ) to Buy from Hold and raised its price target to $8.00 from $5.00 following the company’s Q2 report and the announcement of a four-year extension of its contract with Block (NYSE:SQ) to power its Cash App.
According to Berenberg, this has eliminated a significant uncertainty surrounding the company's shares.
While MQ’s near-term operating performance will reflect the economics of the Cash App renewal, which were (predictably) much reduced from what they had been in the prior deal given Block’s strong bargaining position, the company will now be able to establish a new baseline from which to grow during the next few years.
Shares closed with more than 11% gain yesterday following the announcements.
Kornit Digital upgraded at Morgan Stanley after a Q2 miss
Kornit Digital (NASDAQ:KRNT) shares gained more than 3% premarket today after Morgan Stanley upgraded the company to Overweight from Equalweight with a price target of $29.00.
Shares plunged more than 20% yesterday after the company’s reported Q2 revenues came in worse than expected.
According to Morgan Stanley, this reaction is overblown given a strong post-ITMA systems and upgrade pipeline that should return the company to revenue growth and EBITDA profitability in 2024.
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