Barron’s is bullish on Facebook, bearish on GE

Barron’s, the weekly publication owned by the Wall Street Journal, in its latest issue mentions several names:

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BULLISH  MENTIONS

Cummins, United Technologies good industrial bets – Cummins (CMI), United Technologies (UTX), Honeywell (HON), Ingersoll-Rand (IR) and Illinois Tool Works (ITW) boast good dividends that should rise, Lawrence Strauss writes in this week’s edition of Barron’s.

Facebook still looks like a buy – In a follow-up story, Barron’s says that Facebook’s  (FB) political-advertising imbroglio has obscured some very good revenue news. Slowing supply growth helped drive up demand and prices for Facebook ads, marking a reacceleration of growth, the report notes, adding that the company is also coming up with innovative ways to cash in on booming interest in video and creating new ad opportunities on its Messenger and Instagram platforms.

Kohl’s updated return policy raises Amazon takeover questions – Following Kohl’s (KSS) announcement that Amazon (AMZN) purchases could be returned at its stores in Chicago and Los Angeles, some have questioned if the e-Commerce giant is planning to buy the retailer, Steven Sears writes in this week’s edition of Barron’s. Citing Madison Global Partners’ Bernard Sosnick, the publication said Amazon may be testing the merits of owning a retailer that can build private-label products to showcase Amazon devices and services, with the holiday season to test the theory further.

May be time to play Mattel – Mattel (MAT) is half the stock it used to be, but the maker of Barbie and Hot Wheels knows it has a problem, Ben Levisohn writes in this week’s edition of Barron’s. Management said it would target $650M in cost cuts through 2019, while also enacting initiatives to reduce unpopular products and create new ones to help boost sales, and if it works, Mattel could be a winner, he adds.

Upside ahead for smaller companies – As tech giants soar and as the rally favors the biggest companies, there may be upside on deserving, smaller companies, such as AMD (AMD), Impinj (PI) and Everspin Technologies (MRAM), Tiernan Ray writes in this week’s edition of Barron’s. Meanwhile, companies such as Finisar (FNSR), Lumentum (LITE), Viavi (VIAV), Oclaro (OCLR), Applied Optoelectronics (AAOI), Inphi (IPHI), and NeoPhotonics (NPTN) are grappling with a slowdown in spending in China, but are “back for real,” he argues.

Intel AI push to boost growth – Artificial intelligence has been perceived to be a threat to Intel’s (INTC) decades-long dominance in computer chips, but its shares are up 30% this year, maybe due to third quarter earnings or maybe due to its plans to release a new line of A.I. chips developed in collaboration with Facebook (FB), and as the company’s purchase of Mobileye makes it an early leader in autonomous driving, Jack Hough writes in this week’s edition of Barron’s, adding that he still sees more upside ahead.

IBM, Google among potential AI winners – After decades of development, Artificial Intelligence-style computing now works, and its impact will spread far beyond board games such as Go or chess, Bill Alpert writes in this week’s edition of Barron’s. Citing Wells Fargo analyst Ken Sena, the report says the biggest beneficiaries will be the firms pioneering the technology, with machine learning already powering search suggestions of Google (GOOG; GOOGL) and Microsoft (MSFT), chatbots like Amazon’s (AMZN) Alexa, and the recommendations at Facebook (FB), and Netflix (NFLX). Given China’s vast size, the analyst also has similar outperformance expectations for Alibaba (BABA), Baidu (BIDU), JD.com (JD), and Tencent (TCEHY), Barron’s adds.

BEARISH  MENTIONS

Powerful bearish trend in General Electric – Investor’s confidence has eroded and General Electric’s (GE) stock price is at 2012, with a powerful bearish trend, Michael Kahn writes in this week’s edition of Barron’s. But while it may look like a bargain and the stock could be the buy of the decade, Kahn argues that he still needs to see the market give him either an unambiguous selling climax, or a strong upside reversal. If not for inertia, most investors would probably have already sold their shares of General Electric, but they may be persuaded as early as November 13, when its new leader, John Flannery, holds an investor day meeting, Steven Sears writes in this week’s edition of Barron’s. However, he notes that it is difficult to know how investors will react to whatever is announced at the meeting. If GE releases a draconian restructuring plan, shares could rally as investors reason that all of the bad news is out of the way, but if they lack confidence in Flannery’s approach, the stock could trade sharply lower, Barron’s adds.

Sell Under Armour as troubles ‘run deep.’  – In a follow-up story, Barron’s says that despite the skid in Under Armour (UA) shares, the sportswear company faces continuing woes, from a shift to lifestyle garments to the internet. Further, the publication notes that there seems little reason to hold shares through the holidays in hopes of a rebound.


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