Align Technology (NASDAQ: ALGN) had its hold rating reissued by analysts at Cantor Fitzgerald. They currently have a $40.00 price target on the stock, up from their previous price target of $35.00. The analysts wrote, “With ALGN reporting 2Q:13 EPS AMC on 7/18, we provide our updated thoughts on recent developments and a preview of 2Q results. ALGN has enjoyed a string of positive catalysts in recent months, including above-consensus 1Q results, a favorable ruling on ClearCorrect patient infringement, and the Henry Schein partnership. Given the recent momentum and our expectation that 2Q comes in at or above the high end of guidance, we are raising our price target from $35 to $40 (15x 2014E EV/EBTIDA), but we maintain our HOLD rating due to our ongoing concern over pricing and a GP dentist segment that is stable but recovering slowly.”
Comerica (NYSE: CMA) had its neutral rating reissued by analysts at Citigroup Inc.. The firm currently has a $40.00 target price on the stock, down from their previous target price of $41.00. The analysts wrote, “2Q13 results validated that near-term fundamentals remain weak for CMA and most of its regional bank peers. Although loan growth was up 3.5% LQA, we calculate that absent growth in mortgage banker loans, core C&I loan growth was closer to flat. CMA did not change its ’13 loan growth guidance (up y/y but at a lower growth rate than ’12 versus ’11), but our sense is that as investors update their models, they will have to dial back ’13 loan growth assumptions a bit. That does not move the ’13 earnings needle all that much since the stock of loans is more important than the flow. As a point of references, every ~1% change in loan growth changes our ’14 and ’15 estimates by ~$0.01 and ~$0.05, respectively. Also, non-interest expense will tick up a bit in 2H13 due to CCAR related costs and a handful of seasonal items but provision expense should be lower than previously expected. Non-interest bearing deposits fell ~$907 mm q/q, but CMA says this was largely because customers were paying taxes.”
DISH Network Corp. (NASDAQ: DISH) had its buy rating reissued by analysts at Citigroup Inc.. They currently have a $61.00 price target on the stock, up from their previous price target of $43.00. The analysts wrote, “Mr. Ergen faces twin strategic challenges. For his DBS business, the balance of power still skews heavily in favor of the content firms putting secular pressure on video margins. And, following the failed attempt to acquire Sprint – coupled with T-Mobile’s acquisition of MetroPCS and AT&T’s offer for Leap – Dish’s wireless spectrum is quickly running out of strategic partners. In light of these twin challenges, Mr. Ergen has two broad options: 1) Hold the assets that he has and attempt to navigate these challenges as a standalone firm or 2) Sell his wireless and DBS assets to suitors that may create more economic value than Dish could on its own. We suspect Mr. Ergen is savvy enough to recognize that a sale of his assets is the most prudent – and most lucrative – course of action.”
Eastman Chemical (NYSE: EMN) had its buy rating reissued by analysts at Goldman Sachs Group Inc.. The firm currently has a $86.00 target price on the stock, up from their previous target price of $83.00. The analysts wrote, “EMN has recently been more vocal in its pursuit of a potential divestiture of its merchant market ethylene exposure, stating that they are ‘in the middle of conversations with a variety of parties,’ have opened up a dataroom and are hosting site visits at its Longview crackers. In our view EMN’s options range from the full sale of all four of its Texas crackers to the partial sale to off-take agreements. We do not take a view on the likelihood of any particular outcome, but we believe such a divestiture would be positive for EMN valuation long term.”
EQT Midstream Partners LP (NYSE: EQM) had its buy rating reissued by analysts at Citigroup Inc.. The firm currently has a $52.00 target price on the stock, up from their previous target price of $46.00. The analysts wrote, “EQM agreed to acquire the Sunrise Pipeline and the associated Jefferson compression expansion project from EQT. The deal came slightly earlier than expected and was also larger and more accretive. Total cost, including $30 mil of capex and assuming a 3rd party contract is executed on the expansion, will be $680 mil and represents an 8.7x multiple paid on an estimated $78 million of EBITDA (’14 exit rate). See Fig. 1 on pg. 3 of this report for a run-down of the transaction and a comparison versus our original estimates.”
Johnson & Johnson (NYSE: JNJ) had its buy rating reiterated by analysts at Citigroup Inc.. Citigroup Inc. currently has a $101.00 target price on the stock, up from their previous target price of $95.00. The analysts wrote, “2Q results were better than expected, driven by new products in Pharma and expense control. JNJ kept conservative guidance for 2H (tougher comparisons and larger FX headwind) which we believe has left room for upside. TP up to $101. Sales of $17.9B (+8.5%) were nearly $200MM ahead of the Street and our forecast. FX clipped sales by 150bp and net acquisitions contributed 440bp which puts organic sales at 5.9% up from 5.1% in 1Q13 and 4.7% in 2H12. Pharma (+13% organic) was $325MM above the Street and accelerated from the prior quarter as Zytiga, Incivo, and Xarelto contributed 50% of the growth and Europe growth accelerated. MD&D (+1.5% organic) arrived $140MM below the Street as Diabetes, Diagnostics, and Orthopedics combined for most of the miss. Consumer (+2.5% organic was about $30MM below the Street as several businesses came in slightly below expectations.”
The Mosaic (NYSE: MOS) had its neutral rating reissued by analysts at Citigroup Inc.. The firm currently has a $56.00 target price on the stock, down from their previous target price of $57.00. The analysts wrote, “FY 4Q13 EPS of $1.14 was slightly better than expected and represented decent execution amid tough industry conditions. MOS’s forward-looking commentary supports our view that industry fundamentals are challenging, including lower price guidance for the upcoming quarter and caution on India P&K demand until mid-2014 (due to a weak rupee and upcoming elections). As we noted when we downgraded MOS to Neutral in June, we do not see many catalysts for the stock, although the buyback program expected in late 2013 should provide a floor under the shares.”
Charles Schwab Corp. (NASDAQ: SCHW) had its hold rating reiterated by analysts at Goldman Sachs Group Inc.. The firm currently has a $18.00 price target on the stock.
Charles Schwab Corp. (NASDAQ: SCHW) had its buy rating reissued by analysts at ISI Group. The firm currently has a $25.00 price target on the stock, down from their previous price target of $26.00. The analysts wrote, “The miss to our estimate and Consensus was on higher expenses than forecast, at $925mn vs. our $909mn estimate, while revenue was slightly better than expected at $1.337bn vs. our $1.326bn estimate. Overall, the revenue growth story remains intact, even with just modest NIM expansion from yield curve steepening, and mgmt retained its outlook for mid-$0.70s EPS in 2013. The 3% selloff is understood given strong recent performance (up 47% YTD), higher than expected op costs and statement on short-term rates being a much more important earnings driver, though we do not think major NIM expansion on yield curve steepening is factored into expectations.”
Charles Schwab Corp. (NASDAQ: SCHW) had its neutral rating reissued by analysts at JPMorgan Chase & Co.. JPMorgan Chase & Co. currently has a $19.00 price target on the stock, up from their previous price target of $15.00. The analysts wrote, “Schwab reported 2Q13 EPS of $0.18, falling modestly short of the $0.19 consensus on what we think was slightly higher compensation expense, higher share count and a modestly lower NIM. Key metrics were solid if not good, but mgmt highlighted the company’s particular sensitivity to short term rates, which we think comes at some surprise to some investors. We maintain our Neutral rating despite solid fundamentals, as we see much good interest news priced into the stock.”
Splunk (NASDAQ: SPLK) had its buy rating reiterated by analysts at Topeka Capital Markets. The firm currently has a $62.00 price target on the stock, up from their previous price target of $53.00. The analysts wrote, “In our view, Splunk is in the right place at the right time as the Big Data buildout remains in the early stages of development and with great potential. We believe the combination of continued enthusiasm around the Big Data theme and Splunk’s ability to deliver new, innovative software solutions, will provide investors with reason to bid the stock higher. As such, we are raising our 12-month price target to $62.00 from $53.00.”
Safeway (NYSE: SWY) had its sell rating reiterated by analysts at UBS AG. The analysts wrote, “We first published our Safeway preview last week on July 11, which highlighted our view of what SWY would look like with Canada moved into discontinued operations. This is a difficult task to model since there is no available Q2 12 comparable results to model from. We are taking this opportunity to adjust the phasing our quarterly estimates, one last time before the results. We arrive at our ex-Canada estimates by attempting to model Canada by quarter and then backing it out of our model. We decided that our Canada revenues in Q2 were too high and H2 was too low. Since Canada is higher margin (5% vs US grocery 1.5%), we were understating the remaining profits by removing too much Canada revenue in Q2 (likewise H2 EBIT was too high). We increase our Q2 EBIT margin from 1.3% to 1.8% and Q2 EPS from $0.13 to $0.25. No change to full year EPS estimates. See page 2 for Q2 estimates in detail.”
Web.com Group (NASDAQ: WWWW) had its buy rating reiterated by analysts at Northland Securities. Northland Securities currently has a $26.00 target price on the stock.
Yahoo! (NASDAQ: YHOO) had its buy rating reiterated by analysts at Cantor Fitzgerald. They currently have a $29.00 price target on the stock, down from their previous price target of $30.00. The analysts wrote, “Yahoo! reported muted 2Q results, with lighter revenue and higher EPS. While the top line is stabilizing, and the pace of product launches/user engagement is improving, Yahoo! continues to lose market share in both Display and Search. That said, short-term, the stock is benefiting from the prospects of an Alibaba IPO, improvements in Yahoo! Japan and an active/large buyback, all on the back of an attractive valuation. Longer-term, however, the stock’s performance will have to correlate with the turnaround in Yahoo!’s core business, which we won’t have material visibility into until 2014. YHOO remains a SOP story, with the Asian assets and cash amounting to ~$21.30/sh and a $1.9B buyback that should limit the downside.”
Yahoo! (NASDAQ: YHOO) had its buy rating reissued by analysts at Citigroup Inc.. Citigroup Inc. currently has a $31.00 target price on the stock, up from their previous target price of $30.00. The analysts wrote, “Like many recent quarters, Yahoo!’s earnings report included puts and takes, but we believe the net of these were positive in 2Q13. The positives, in our view, were: 1) Alibaba Group’s (AG) growth (in 1Q13) was significantly better than we forecast (recall that we estimate AG represents ~35% of YHOO’s current value); 2) the company recommitted to its buyback program, with at least another $1.9bn to come; and, 3) user engagement, a precursor to revenue growth, stabilized and even began to grow again in 2Q13. The main negative, which resulted in a 1% reduction in CY13 rev guidance, was that display pricing continues to be pressured by industry dynamics related to growth in cheaper inventory sources and gains by ad exchanges. While we tweak our core Yahoo! forecasts down, our price target increases from $30 to $31 due to the significantly better Alibaba Group results.”
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