Disney 'attractive' here; Carvana looking rosy near term: 5 big analyst picks
Investing.com | Author Davit Kirakosyan
Published Sep 18, 2023 14:34
Investing.com -- Here is your Pro Recap of the biggest analyst picks you may have missed since Friday: an initiation at Outperform for Walt Disney , as well as upgrades for Carvana , Micron, Unity Software, and Shake Shack.
Never miss another market-moving headline.
Walt Disney started at Outperform at Raymond James/h2
Raymond James initiated coverage on Walt Disney (NYSE:DIS) Monday with an Outperform rating and a price target of $97.00.
The firm believes Disney's assets position the company favorably in the evolving media landscape, as it offers strong streaming services and a valuable portfolio of intellectual property.
The analysts elaborated:
"With two scaled U.S. Streaming services in Disney+ (46M domestic subs) and Hulu (48M), as well as ESPN+, Disney is bundling its services, driving higher Average Revenue Per Account (ARPA), lower churn, and strong pricing power."
Shares were nearly unchanged at the open Monday.
Micron shares gain on Deutsche Bank upgrade/h2
Micron Technology (NASDAQ:MU) shares rose more than 1% pre-market Monday after Deutsche Bank upgraded the company to Buy from Hold and raised its price target to $85.00 from $65.00.
Deutsche Bank noted that its previous neutral stance on Micron was based on the challenges besetting the semiconductor industry, such as excess inventory in the supply chain and weak macroeconomic demand.
The analysts said, however, that they "now see the worst of the downcycle as behind us, given aggressive production cuts by all suppliers, as well as pockets of demand strength particularly in AI servers (for both HBM and DDR5)."
Shares were trading up 0.9% to $70.49 early in Monday trading.
Carvana upped to Neutral at Wedbush/h2
Wedbush on Monday upgraded beleaguered used-car purveyor Carvana (NYSE:CVNA) to Neutral from Underperform with a $48 price target.
The analysts in part cited the company's just-completed debt exchange and improving profitability, which it believes "could drive upside in 3Q23 and 4Q23, and also give the company at least two years of breathing room to execute."
Wedbush also mentioned recent "significant progress on operational initiatives," adding that Carvana is also benefiting from "more favorable industry pricing conditions, loan sales that are on pace to greatly exceed originations, and favorable pricing in the ABS [asset-backed securities market, which should help drive upside in the near-term."
The move comes after the United Auto Workers (UAW) union announced a strike at the big three automakers, Ford (NYSE:F), General Motors (NYSE:GM), and Stellantis (NYSE:STLA), after which investors bid Carvana shares up more than 13% in that session on the belief that the work stoppage could impact new vehicle production in the US, thus pushing up rental car prices and ultimately benefiting the company.
Shares retreated 6.6% Friday but, overall, shares are up tremendously for the year, with gains of more than 1,000% as the company has pulled back from the brink of bankruptcy.
Shares opened Monday trading with a 1% gain to $52.74.
InvestingPro.
The bank is positive on recent pricing changes and thinks risks for the company are well understood and are more than reflected in the valuation, commenting:
Unity announced pricing and plan changes on September 12 for Unity Runtime and Unity Plus customers. The stock has since traded down roughly 8% on fears pertaining to potential creator churn. We believe U’s incremental monetization opportunity outweighs the risks.
Shares rose 1.7% Friday, but were losing 4.1% to $34.82 shortly after the open.
Shake Shack earns an upgrade at Northcoast Research/h2
Northcoast Research upgraded Shake Shack (NYSE:SHAK) to Buy from Neutral on Friday with a price target of $85 as dine-in traffic continues to strengthen.
The analysts said they believe Shake Shack "is well positioned to drive industry-leading, double-digit unit growth for years as development opportunities remain robust globally, in the US, Canada, Europe and Asia."
InvestingPro.
Get The App
Written By: Investing.com
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.