Barron’s is bearish on Fitbit, L Brand and Nokia

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

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BULLISH   MENTIONS:

Invesco stock weakness a buying opportunity – U.S. stocks are down 5% from their January 26 peak, while shares of Invesco (IVZ) have fallen much more, which gives investors a buying opportunity, Jack Hough writes in this week’s edition of Barron’s. Driven by strong exchange-traded fund lows, BlackRock’s (BLK) shares have skyrocketed in recent years while Invesco’s have lagged behind, he notes, adding that the latter’s forward price-earnings multiple now represents a bargain-basement 44% discount to BlackRock’s.

Nordstrom, TJX appear to have most staying power– Department store stocks have rebounded in recent months, but they are not all likely to emerge as winners, Avi Salzman writes in this week’s edition of Barron’s. Nordstrom (JWN) and TJX (TJX) appear to have the most staying power, with the former the more attractive choice in terms of valuation, he notes. Kohl’s (KSS) and Macy’s (M) are showing new life but need to prove they can repeat their fourth quarter performances, Salzman says, adding that JCPenney (JCP) and Dillard’s (DDS) remain “tricky.”

BEARISH  MENTIONS:

L Brands shares may still go lower given multiple problems – Shares of L Brands  (LB) tumble after quarterly results, with the stock trading at just 13.5 times 12-month earnings forecasts, Ben Levisohn writes in this week’s edition. While it may look tempting, Levisohn cannot help think that the multiple problems facing the company could send them lower still.

Not much time left for Fitbit – In a follow-up story, Barron’s notes that plenty of people still use fitness trackers and Fitbit (FIT) still sells millions of them, but the company has acknowledged that the market is “rapidly changing.” Fitbit CEO James Park has pledged to expand the company’s line of watches, putting it in direct competition with Apple (AAPL), but there is no indication that Fitbit knows how to nurture an “ecosystem” of software developers.

VMware investors not happy with possible Dell deal – VMWare (VMW) fell on Thursday and Friday in the wake of a CNBC report that Dell and VMware are considering a reverse merger in which the latter would issue shares to Dell Technologies and allow it to go public without doing an IPO, Andrew Bary writes in this week’s edition of Barron’s. A Dell/VMware combination could benefit Dell’s tracking stock for VMware, he notes, while adding that VMware investors are not happy about a possible transaction as it would link a thriving, cash-rich company with a highly leveraged Dell.

5G cannot deploy fast enough for Ericsson/Nokia – While the battle to dominate the future of wireless networks would be a boon for any wireless arms merchant such as Nokia (NOK) or Ericsson (ERIC), the race to build the new technology dubbed 5G is not going to produce a boom in revenue overnight, and both companies are struggling to get back on their feet, Tiernan Ray writes in this week’s edition of Barron’s. If they stabilize this year, and sentiment starts to warm about 5G, it could boost their stock prices even if 5G takes a while to pay off, he adds.


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