Crocs, Roku, BrightView Holdings Upgrades by Investing.com

Investing.com — Here’s a professional recap of the top Wall Street analysts for the past week.

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Apple

What happened? On Monday, MoffettNathanson initiated Apple (NASDAQ: ) at Neutral with a price target of $211.

*TLDR: MoffettNathanson ponders the issue of Apple’s valuation being too high and/or above its fair value. The firm remains concerned about Apple’s AI potential, noting “unclear data on acceptance in Greater China and potential regulatory challenges.”

What is the full story? Analysts at MoffettNathanson question whether Apple’s valuation is overpriced, noting that the share price reflects an iPhone upgrade cycle that is expected to be significantly larger than the 2021/22 5G cycle. They express skepticism about this assumption and highlight the overlooked regulatory risks associated with Apple’s deal with Google (NASDAQ: ) for the default search position. While the firm expects Apple to execute its strategy well, they believe the market has already priced in those expectations. The key question remains whether the anticipated upgrade cycle driven by Apple Intelligence will be higher or lower than expected.

The firm also raises concerns about Apple’s future beyond AI, including unclear data on Apple’s acceptance in China and potential regulatory challenges that could hurt Apple’s competitive ability. Despite a positive bias toward Apple’s AI strategy, MoffettNathanson concludes that the current valuation suggests that the market has already taken these factors into account. They recommend waiting for a shake in market confidence before making further investments.

Neutral at MoffettNathanson means “Neutral recommendations are typically within 15% of fair value.”

AMD

What happened? On Tuesday, Edward Jones initiated coverage on Advanced Micro Devices (NASDAQ: ) at Buy without a price target. AMD was also added to the Edward Jones Stock Focus List

*TLDR: Edward Jones analysts believe AMD will see significant growth due to growing demand for data center infrastructure and the integration of Xilinx programmable chip products, with a potential $10 billion opportunity. The firm also points out that the rebounding PC market, led by AI-enabled computers, could lead to sustained growth that is not yet fully reflected in AMD’s current share price.

What is the full story? Edward Jones analysts believe AMD is poised for significant growth thanks to several key factors. Rising demand for data center infrastructure is expected to boost sales of AMD chips, especially GPUs and processors. In addition, the acquisition of Xilinx (NASDAQ: ) introduced new programmable chip products and expanded AMD’s market reach. Analysts suggest AMD is still in the early stages of integrating and cross-selling Xilinx and AMD products, with management estimating the opportunity could be worth as much as $10 billion.

In addition, analysts point out that the PC market, which has started to recover, could see sustained growth driven by AI PCs, which may lead to a longer upgrade cycle. They argue that this optimism is not yet fully reflected in AMD’s current share price, indicating the potential for further appreciation.

Buy on Edward Jones means “We believe the valuation is attractive and the total return potential is above average over the next 3-5 years relative to industry peers.”

BrightView Holdings

What happened? On Wednesday, Jefferies upgraded BrightView Holdings (NYSE: ) to Buy with a $17 price target.

*TLDR: Jefferies upgrades BV to Buy from Hold, expecting low single-digit revenue growth and record margins, driven by a new CEO and significant progress over the past 10 months. The brokerage expects margins to expand from ~11% in FY23 to above 13%, supported by cost reduction, profitable growth and improved customer and employee retention.

What is the full story? Jefferies upgraded BrightView from Hold to Buy, anticipating a return to low single-digit percentage revenue growth and record margins. This optimism is driven by the leadership of a new CEO with an exceptional track record who has made significant progress at BV over the past 10 months. The brokerage expects margins to expand from around 11% in FY2023 to over 13%, supported by the company’s focus on cost reduction, profitable growth and improved customer and employee retention.

The brokerage’s confidence in BV’s future performance is bolstered by the improved management team and strategic initiatives implemented under the new CEO. These efforts are expected to drive both revenue growth and margin expansion, positioning BV for strong financial performance in the coming years.

Buy at Jefferies means “Describes securities that we expect to deliver a total return (price appreciation plus yield) of 15% or more over a 12-month period.”

Crocs

What happened? On Thursday, Williams Trading upgraded Crocs (NASDAQ: ) to Buy with a $163 price target.

*TLDR: Sidney Sweeney’s role as brand ambassador will appeal to young consumers and increase HEYDUDE’s visibility, boosting FY24 and FY25 revenue estimates to $873m, despite indications of an 8%-10% decline. Analysts point to a “clean market” and “data drive allocation options” for Crocs/HEYDUDE to pressure competitors like VANS.

What is the full story? The research team believes that the addition of Sidney Sweeney as a brand ambassador/global spokesperson will appeal to young consumers and bring much-needed attention to the HEYDUDE brand. Williams Trading expects the deal with Sweeney to last until at least 2025. As a result, the research team raised its FY24 and FY25 revenue estimates for HEYDUDE from $859.5 million to $873 million, despite indications which indicates an 8% to 10% revenue decline for FY24. . They are confident that Crocs’ history of long-term brand marketing leading to positive short-term results will begin to show at HEYDUDE.

Analysts stress the importance of maintaining a clean market and implementing an attraction model for both Crocs and HEYDUDE. They emphasize the need for sales and merchandising teams to fully embrace data analytics for allocation and distribution decisions and stop MAP holidays in core styles and silhouettes. Analyzing the Spring ’25 lineup, the team notes that offerings for both brands are becoming increasingly focused. New products like the Crocs Echo Wave Mule and Echo Surge Sneaker, along with the return of the Bae Platform Clog, are expected to perform well. The introduction of Wally and Wendy Comf and updated styles from HEYDUDE look promising, provided demand is accurately planned and allocated accordingly. The increased focus on HEYDUDE may put additional pressure on competitors such as Vans and other casual canvas footwear brands in the short term.

Buy on Williams Trading means “The stock’s total return (price appreciation plus dividend yield) is expected to exceed more than 15% over the next 12-month investment horizon.”

Roku

What happened? On Friday, Guggenheim upgraded Roku Inc (NASDAQ: ) to Buy with a $75 price target

*TLDR: Monetization is improving. Investors are likely to realize management’s efforts to improve ad sales.

What is the full story? Guggenheim expects investor enthusiasm for Roku to grow leading up to Q3 earnings in November as the company makes progress in expanding ad sales in video inventory through third-party on-demand platforms and improving monetization on the home screen. This progress is anticipated to increase confidence in Roku as a unique top acceleration story in 2025. The revised brokerage rating reflects pre-consensus financial estimates for 2024 and 2025 and an attractive relative valuation based on a normalized OIBDA margin of 15%, which they believe the company will achieve through revenue growth and cost management.

Despite concerns about connected TV market leader Roku’s slow response and competitive pressures in advertising and CTV, Guggenheim believes monetization consolidation and leadership execution by Roku Media President Charlie Collier and CFO Dan Jedda should support growth and disciplined performance in the next three to six. Monday. This is expected to boost investor enthusiasm and better position the company for long-term performance.

Buy at Guggenheim means “Describes stocks that we expect to deliver a total return (price appreciation plus yield) of 10% or more over a 12-month period.”