Technology

7 Big Technology Stocks Where Analysts Keep Raising Targets and Ratings

Jon C. Ogg

Published: March 4, 2019 7:15 am

Last Updated: January 31, 2020 12:00 am

Investors have been stunned to see that the massive selling in late-2018 became a V-bottom with a snapback rally that was just as violent on the upside in the first quarter of 2019 as the downside felt in the fourth quarter. With the Dow Jones industrials, S&P 500 and Nasdaq all up double-digits in the first two months of trading in 2019 alone, investors need to consider how they want to position their assets for the rest of 2019 and beyond.

One strategy that many investors have followed over time is to not fight the tape. That means looking at companies with solid news and with which the shares are generally not getting hurt. 24/7 Wall St. reviews dozens of analyst research reports each day, and this turns into hundreds of analyst calls reviewed each week. Our goal is to find new ideas for investors and traders alike.

After looking through the various earnings reports and pairing them off with analyst calls, there are seven standout stocks in the technology sector wherein analysts have raised their ratings or price targets handily over the past 10 days. These companies generally offer solid guidance ahead based on the current business climate, so it’s easy to imagine even more upside if the China trade issues get worked out and if the global economic growth story will just cooperate a little better than it was looking just a few weeks ago.

Additional color has been added on each, and the references to consensus data come from Thomson Reuters (Refinitiv).

Here are seven technology stocks that have gotten multiple target price or rating hikes from analysts on Wall Street.

Etsy

Etsy Inc. (NASDAQ: ETSY) may be considered a retail platform for the public, but if you are into crafts, jewelry and your own apparel and accessories, it is the marketplace to go to. Etsy was up as much as almost 10% at $64.00 in the after-hours reaction from its earnings last Monday, and the rally continued with Etsy closing out the week at $72.77, after an all-time high of $73.33 seen on Friday. Several analyst calls were seen here:

• Deutsche Bank reiterated its Buy rating and raised its target to $72 from $64.
• KeyBanc Capital Markets reiterated it as Overweight and raised its target to $75 from $59.
• Wedbush Securities kept a Neutral rating but raised its target price to $60 from $50.
• And Roth Capital reiterated its Buy rating and raised its target from $64 to $72.

Intel

It is no stranger to analyst calls, but many investors still consider Intel Corp. (NASDAQ: INTC) an old-tech giant that is being passed by smaller and more nimble semiconductor players as the world has migrated away from PCs. Intel closed at $53.30 on March 1, in a 52-week trading range of $42.36 to $57.60. While its shares are right at the consensus target price, two big calls were seen late in February:

• On Feb. 22, Morgan Stanley raised the shares to Overweight from Equal Weight and its target price to $64 from $55.
• On Feb. 26, Deutsche Bank reiterated its Buy rating and raised its target to $65 from $55.

Palo Alto Networks

Palo Alto Networks Inc. (NYSE: PANW) was definitely one of the big technology earnings season winners, with its focus on data security and network security. While the earnings report was stellar, and with acquisitions outlining even more growth ahead, more than 10 analysts following the stock have raised their price targets. We have covered this in greater detail elsewhere, but serious target hikes were made by Merrill Lynch, Piper Jaffray, Deutsche Bank, Maxim, Wells Fargo and more.

Palo Alto Networks shares closed out the week at $245.47, in a 52-week range of $160.08 to $260.63. It was roughly at $235 before the earnings pop.

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Splunk

Splunk Inc. (NASDAQ: SPLK) may have closed down 0.9% at $134.65 on Friday, but the company did beat earnings and gave strong guidance. Analysts liked the move better than the stock’s reaction might indicate. The overall rating remains Buy/Outperform, but here were some of the price target hikes seen:

• Barclays to $158 from $154
• Credit Suisse to $160 from $130
• Monness Crespi & Hardt to $200 from $170
• Needham to $162 from $145
• Raymond James from $122 to $157
• Wedbush from $146 to $159
• Wells Fargo from $145 to $165

VMware

Shares of VMware Inc. (NYSE: VMW) closed up 3.7% at $178.20 on Friday, while the 52-week range is $113.90 to $184.41. The 52-week high was put in this past week, and that’s also an all-time high since its debut in 2007. VMware saw at least seven analysts hike their target prices:

• Barclays to $200 from $168
• BMO Capital Markets from $170 to $195
• Citigroup to $201 from $166
• Credit Suisse from $160 to $185
• Deutsche Bank to $200 from $190
• Wedbush from $173 to $190
• Wells Fargo to $180 from $155

Zscaler

Zscaler Inc. (NASDAQ: ZS) traded up over 15% at $57.50 in last Thursday’s after-hours session after solid earnings, and the stock ended almost 22% higher at $60.57 by Friday’s closing bell. Its post-IPO range is now $24.76 to $61.14. Wedbush reiterated its Outperform rating and raised its target to $68 from $53, noting that total revenue growing 65% and billings accelerating 74% year over year handily beat consensus expectations. One of the more interesting aspects of Zscaler is that it seems to have created an entirely new niche within data and enterprise security.

Two other target hikes were seen as well, but with caution on the valuations:

• Deutsche Bank maintained its Hold rating based on valuation but still boosted its target to $57 from $44.
• Barclays issued a similar call, maintaining its Equal Weight rating but raising its target to $55 from $42.

Cisco

Cisco Systems Inc. (NASDAQ: CSCO) might be considered a runner-up because the calls were not all within the past 10 days. The company has been changing its model to offering security and services with recurring revenue streams on top of selling its industry-leading networking equipment. Cisco also should be a serious 5G winner in the coming years, and its stock hit highs in the end of February not been seen since the glory days of the tech and internet bubble in 1999 and 2000.

These were mid-February calls with positive ratings and price target hikes:

• Citigroup to $56 from $52
• KeyBanc to $55 from $53
• Wells Fargo to $57 from $52
• Independent research firm Argus reiterated its Buy rating and raised its target to $65 from $55.

If you want to see another grouping of key analyst calls, Goldman Sachs issued very positive Buy ratings in upgrades or new coverage on more than a dozen stocks in February. Only one of them performed badly, and four or five of them already managed to achieve what were supposed to be their 12-month total targets.

Remember that analysts are not omniscient. Investors should consider that analysts sometimes stick with a positive story for too long, only to eventually keep staying positive with lowered price targets when they should have just downgraded the stock and said “the best of this story has been seen.” Sometimes the baseline scenarios also run into trouble. In many cases, an analyst may have not had any better information or knowledge on a company than the rest of us. And finally, sometimes a view from an analyst is just wrong from start to finish.