Technology

Jefferies Analysts Out With Top Stock Picks Before Global Tech Conference

Lee Jackson

Published: May 8, 2018 8:30 am

Last Updated: January 11, 2020 11:57 pm

With summer right around the corner, so is the annual Wall Street conference schedule, as the warm summer days and nights are much preferable to attendees than the snow and cold in the winter.

This week, Jefferies helps to kick off the season with the firm’s annual Global Technology conference that is being held May 9 and 10 in Beverly Hills, California. This very popular event should see big attendance, with most of the top tech companies in the industry there.

In a new research report previewing the conference, Jefferies analysts showcase their top picks in front of the conference. Nine companies are highlighted and all are rated Buy at Jefferies.

It is important to note that often catalysts come out of the conferences, so it can make sense to buy shares in front of the presentations.

Activision Blizzard

This is a top pick across Wall Street and Jefferies remains very positive on it. Activision Blizzard Inc. (NASDAQ: ATVI) develops and publishes online, personal computer (PC), video game console, handheld, mobile and tablet games worldwide. The company develops and publishes interactive entertainment software products through retail channels or digital downloads and downloadable content to a range of gamers.

Activision Blizzard shareholders are paid a small 0.51% dividend. The Jefferies price target for the shares is $86, and the Wall Street consensus target is $76.36. The stock closed Monday at $70.37 per share.

Adobe Systems

This high-profile old-school software company has posted outstanding earnings. Adobe Systems Inc. (NASDAQ: ADBE) operates in three segments. The Digital Media segment provides tools and solutions that enable individuals, small and medium businesses, and enterprises to create, publish, promote and monetize their digital content. The other segments are Digital Marketing and Print and Publishing.

Top Wall Street analysts see the company benefiting from artificial intelligence, predictive analytics, automation bots, speech recognition and natural language processing and image recognition. Some on Wall Street see earnings per share increasing a solid 30% or more for 2018.

The Jefferies team feels the company deserves a premium multiple to its peers due to Adobe’s strong competitive position in the creative space and above-average growth prospects.

Jefferies has a $265 price target for the shares, and the posted consensus target is $248.31. The stock closed most recently at $230.99 a share.

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Arris International

Jefferies sees this stock as another top value play in 2018. It has been a favorite at the firm for some time and remains a top small cap pick. Arris International PLC (NASDAQ: ARRS) provides media entertainment and data communications solutions in the United States and internationally. It operates through two segments.

The Customer Premises Equipment segment offers various product solutions, including set-top boxes, gateways, digital subscriber lines and cable modems, and embedded multimedia terminal adapters and voice/data modems that enable service providers to offer voice, video and high-speed data services to residential and business subscribers.

The Network & Cloud segment provides cable modem termination system, converged cable access platform, multichannel video programming distributors, programmer equipment, ad insertion technologies and equipment in the ground or on transmission poles, as well as equipment used to initiate the distribution of content-carrying signals.

The $38 Jefferies price objective compares with the consensus target price of $33.80. Shares closed Monday at $26.70.

Cognizant Technologies Solutions

This top stock sold off recently and is offering investors the best entry point in some time. Cognizant Technologies Solutions Corp. (NASDAQ: CTSH) provides information technology (IT), operations and technology consulting, infrastructure and business process services worldwide. The company operates through four segments: Financial Services, Healthcare, Manufacturing/Retail/Logistics, and Other.

The company’s consulting and technology services include strategy consulting, business and operations consulting, technology strategy and change management, and program management consulting services; application design and development; systems integration; and application testing, consulting and engineering services; as well as enterprise information management services.

The analysts see Cognizant benefiting through AI platform, analytics/data discovery, chatbots, natural language, computer vision, advisory and implementation.

Investors receive a 0.88% dividend. Jefferies has set its price target at $90, and the consensus target is $90.15. Shares closed Monday at $77.86.

Inphi

This small cap company is a strong contender in the data center arena. Inphi Corp. (NYSE: IPHI) provides high-speed analog and mixed signal semiconductor solutions for the communications, data center and computing markets worldwide.

The company’s end-to-end data transport platform delivers high signal integrity at leading-edge data speeds, addressing performance and bandwidth bottlenecks in networks, from fiber to memory. Inphi solutions minimize latency in computing environments and enable the rollout of next-generation communications infrastructure.

The stock was hit hard early this year and may be offering investors among the best values. The company recently announced that along with Innovium, it is partnering to provide customers multiple highly scalable industry-leading 100 G to 400 G data center solutions to meet their explosive bandwidth demand growth.

The Jefferies price target is $40. The consensus estimate is $35, and the stock closed Monday at $33.56.

Microchip Technology

This company is a huge Internet of Things benefactor. Microchip Technology Inc. (NASDAQ: MCHP) is a leading provider of microcontroller, mixed-signal, analog and flash-IP solutions, providing low-risk product development, lower total system cost and faster time to market for thousands of diverse customer applications worldwide.

The company recently received a receipt of antitrust clearance in the United States for the proposed acquisition of Microsemi. The company now expects to complete the acquisition of the company in June of this year.

Investors receive a 1.65% dividend. The $110 Jefferies price target is less than the $111.56 consensus price objective, but shares ended Monday at $88.74.

Oracle

This top software stock was hit hard in March and still offers a very good entry point. Oracle Corp. (NYSE: ORCL) develops, manufactures, markets, sells, hosts and supports database and middleware software, application software, cloud infrastructure, hardware systems and related services worldwide.

The company licenses its Oracle Database software to customers, which is designed to enable reliable and secure storage, retrieval and manipulation of various forms of data. Its Oracle Fusion Middleware software aims to build, deploy, secure, access and integrate business applications, as well as automate their business processes.

Shareholders are paid a 1.65% dividend. Jefferies has a price target of $61, and the posted consensus target is $55.73. The stock closed Monday at $46.07.

Radware

Jefferies has been bullish on this company since it started coverage in 2016. Radware Ltd. (NASDAQ: RDWR) is a global leader of application delivery and application security solutions for virtual, cloud and software-defined data centers. Its award-winning solutions portfolio delivers service level assurance for business-critical applications while maximizing IT efficiency.

Radware’s solutions empower more than 10,000 enterprise and carrier customers worldwide to adapt to market challenges quickly, maintain business continuity and achieve maximum productivity while keeping costs down.

The Jefferies price target is set at $28. The consensus target is $24, and shares closed near that on Monday at $23.06.

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WEX

This smaller company looks to be a big winner from tax reform. WEX Inc. (NYSE: WEX) is a provider of corporate payment solutions. It operates through three segments. The Fleet Solutions segment provides customers with payment and transaction processing services designed for the needs of commercial and government fleets.

The Travel and Corporate Solutions segment focuses on the complex payment environment of business-to-business payments, providing customers with payment processing solutions for their corporate payment and transaction monitoring needs.

The Health and Employee Benefit Solutions segment provides health care payment products and software as a service consumer-directed platforms, as well as payroll-related benefits to customers in Brazil.

The company’s tax rate is expected to drop from 36.3%, which Jefferies thinks can raise earnings per share almost 13%.

The $202 Jefferies price target is well above the consensus target is of $174.54. Shares closed Monday at $171.45.

These nine excellent companies are the top picks from the outstanding team of tech analysts at Jefferies. Their shares are good choices for aggressive growth portfolios looking to add to technology weighting.