Earnings season is under way, and we are continuing to update price targets, buy/sell ratings, etc., for companies that we currently cover. Today, we have updated several companies. They include General Motors (NYSE:GM), GT Advanced Technologies (GTAT), Insight Enterprises (NASDAQ:NSIT) and Warnaco Group (WRC).
The chart below shows new ratings, price targets and buy/sell ranges compared to old ones:
GM – Downgrade From Buy To Hold, Decrease PT From $40 To $27
General Motors stock got a solid price cut from us. While the company continues to look pretty good as far as operating income targets, we see available cash flow being hit by less depreciation than expected moving forward. Additionally, the company has a major market in Europe that appears to be under fire. That part of the business does not appear to be strengthening, and that is a hit to future growth. For now, we think the stock is a good hold. If they can see more growth in Asia and right their ship in Europe, this stock will definitely increase in value once again.
GTAT – Maintain At Buy, Increase PT From $18 To $18.50
GT Advanced is one of our favorite solar companies. We believe that the company has a lot of upside from current prices. The solar industry got hit very hard in the past several quarters. We think that the company is still a strong Buy. They are one of the healthiest solar companies with very little debt. Further, they benefit from cheaper PV. The company cut expectations for the next quarter, but we still see further upside as the company's tax rate came down as well as the company improved its cash.
NSIT – Maintain At Hold, Decrease PT From $23 To $17
Insight Enterprises got a slash in price from us after its latest quarter disappointed. It was not by much, but we continue to not see the company improving profitability and margins. Further, we saw the company increase its debt load. Due to this, we decided to increase our discount rate on the stock as it is more risky at this point with less cash and more debt. We do not see a ton of upside in this stock. It is a decent hold, but it does not offer a dividend. Unless the company can move toward better profitability, NSIT will remain stagnant.
WRC - Maintain At Buy, Maintain PT At $64
The quarter came in right at expectations, and we maintain a very positive outlook on Warnaco.
Disclosure: I am long GM, WRC.