Evercore ISI says now is a buying opportunity for semiconductors.
Firm cites the Philadelphia Semiconductor Index “now 10% of its highs, our sense is today is a buying opportunity for those with a 3 plus month time horizon.”
Analyst C.J. Muse says China concerns are growing, but semis likely won’t feel a direct impact in the near future. And that’s offset by a favorable global macro backdrop and rising GDP.
Firm’s best semi ideas:
Intel (INTC +2.8%) with the data center group expected to grow 15% this year. Firm sees EPS of over $3.65 (consensus: $3.57). Price target raised from $55 to $60 (23% upside to Friday).
Nvidia (NVDA +3.1%) earnings will stand as a “clear catalyst” with an earnings upside expected from the tight gaming supply, ongoing DCG ramp, and launch of the Turing graphics cards. Cryptocurrency stands as a headwind.
The firm raises its Lam Research (LRCX +2.8%) CY18 EPS estimate from $17 to $18 and has CY19 EPS at $19.50. Lam could provide earnings upside from rising 3D, NAND, and DRAM complexity. Target increased from $260 to $300 (57% upside to Friday).
Firm says ASML (ASML +2.5%) will benefit from DRAM and thinks EUV fears are overdone.
Evercore lowers Teradyne (TER +1.3%) CY18 EPS from $2.70 to $2.50 and says to add a position when the stock dips below $40.
Source: Bloomberg First Word.
Subscribe for full text news in your inbox