Netflix co-founder and executive chairman Reed Hastings speaks during the New York Times DealBook Summit in the Appel Room at the Jazz at Lincoln Center in New York City on Nov. 30, 2022.
Michael M. Santiago | Getty Images
My top 10 things to watch Friday, May 16
1. Cable companies Charter Communications and Cox Communications agreed to merge. The agreement values Cox, still privately run by the Cox family, at $34.5 billion on an enterprise basis — in line with Charter’s recent enterprise value. Shares of Charter were up 7% in the premarket.
2. Was Applied Materials that bad? No, but China seemed weaker and there was no explanation for it that was sufficient. The maker of semiconductor manufacturing equipment last night reported a slight revenue miss for its fiscal second quarter ($7.1 billion vs. $7.13 billion), sending shares down 5% this morning. JPMorgan, Wells Fargo and Morgan Stanley lowered their price targets.
3. UBS upgraded Caterpillar to hold from sell, citing U.S.-China trade negotiations as limiting the downside risk to earnings and multiples. Still, the analysts said uncertainty will “drag on demand.” They also upgraded United Rentals to hold for same the reason.
4. Barclays raised its price target on AMD to $130 from $110 and kept a buy rating. The firm updated its models for chipmakers following meetings with management teams. AMD and Nvidia this week separately announced multi-year AI infrastructure projects with Saudi company Humain.
5. Dick’s Sporting price target lowered to $217 from $223 at Barclays following announcement that will buy Foot Locker. However, the analysts kept their buy rating, noting that while Dick’s is no longer the “clean compound growth story” of the dominant U.S. sporting goods retailer taking market share, the merger should create a global leader.
6. Netflix price target jacked up to $1,380 from $1,200 at Canaccord. Great 2025 Upfronts, much progress on its ad business.
7. Cadence Design price target raised to $365 from $350 at Wells Fargo. Very strong stock that is about to get some Intel business because its new CEO Lip-Bu Tan came from there.
8. Eli Lilly is the winner in this battle with Wegovy maker Novo Nordisk, which announced this morning that CEO Lars Fruergaard Jørgensen is stepping down as competition increases in market for weight loss drugs. Buy Lilly — it is way too low versus the flailing Novo.
9. Jeffries raised its price target on Palo Alto Networks to $225 from $215, citing limited macro pressure and strong product growth, especially in enterprise.
10. Citi says Walmart can weather tariffs. On Thursday, CFO John David Rainey warned investors that retail giant will have to raise the prices of many items because of Trump’s trade policies.
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