Barron’s is bullish on Chevron and Corning

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

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Stockwinners offers Barron’s review of stocks to buy

BULLISH  MENTIONS

Chevron positioned to benefit in 2018 – No oil major is better positioned to benefit than Chevron (CVX) in 2018, who said it would spend about $18B next year while it starts to reap the benefits from the big projects that had been consuming cash since 2011, Ben Levisohn writes in this week’s edition of Barron’s.

Corning shares could gain over 25%– Shares of Corning (GLW) could keep climbing as demand grows for optical fiber, LCD-panel glass, and Gorilla Glass, Leslie Norton writes in this week’s edition of Barron’s.

Facebook could consider cash dividend – None of the fast-growing giants, namely Facebook (FB), Amazon (AMZN), Netflix (NFLX) and Alphabet (GOOG; GOOGL), pay a cash dividend, but that may change before long, Jon Swartz writes in this week’s edition of Barron’s. Facebook is pushing up against the limits of growth, and if growth begins to taper, investors will begin calling for new strategies, such as dividends and stock buybacks, he notes. Several factors make Facebook the most likely FANG candidate to offer a dividend, perhaps as early as 2019, including sufficient earnings, Swartz contends.

 ‘Good time’ to buy GlaxoSmithKline stock.  GalxoSmithKline’s (GSK) earnings estimates have been sliding and shares have tumbled since the summer, but now looks like a good time to buy the stock, Jack Hough writes in this week’s edition of Barron’s. While GlaxoSmithKline will suffer an earnings hit in 2018 from new generic competition, it should get back on track quickly, he contends.

BEARISH MENTIONS

Some retail stocks look vulnerable – In a follow-up story, Barron’s says that prudent investors should assume that the recent burst of sunshine will give way to more rainy days for retail. Macy’s (M) may look inexpensive but its earnings per share are expected to tumble in each of the next two years, J.C. Penney (JCP) is in a long-term fight for its existence, Sears Holdings (SHLD) makes the former look like Amazon (AMZN), and Abercrombie & Fitch (ANF) sells a deflationary good at a dying venue against a fashion headwind, the report added. On the other hand, Barron’s argued that Wal-Mart’s (WMT) improvement remains intriguing, Home Depot (HD) and TJX (TJX) remain long-term winners, and Five Below (FIVE) seems to be a genuine fast-grower.


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Barron’s is bullish on Apple, Western Digital

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

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Stockwinners offers Barron’s review 

BULLISH  MENTIONS

Apple may hit $1T in market value next year- Apple (AAPL) could soon reach a milestone, namely to be the first U.S. company with a $1T market valuation, with iPhone X and a rising stream of service revenue helping it get there, Jack Hough writes in this week’s edition of Barron’s. Hough does not thing the peak is near as Apple seems to be escaping its product supercycle peaks and troughs to post more-consistent year-to-year growth.

Opportunity seen in semiconductors as Bitcoin plummets on Friday – Last Friday, the price of Bitcoin plummeted over 25% before bouncing back, and no major crypto asset was immune to the selloff, with even Bitcoin Investment Trust momentarily changing hands at more than a 5% discount of its NAV, Crystal Kim writes in this week’s edition. But in every “bloodbath” there is an opportunity to buy, she adds, noting that while bitcoin is a possibility, a better one may be the stocks of semiconductors companies that make the chips and equipment needed to mine bitcoin and other cryptocurrencies.

Some tech still a bargain– For investors looking to buy low, there are a number of good candidates to pick up, such as Qorvo (QRVO) that features in Apple’s (AAPL) iPhone and Finisar (FNSR) that also got the nod from Apple to produce parts for augmented reality and that may be a target for Oclaro (OCLR), Tiernan Ray writes in this week’s edition of Barron’s. Additionally, Ray sees Universal Display (OLED) as the biggest beneficiary of the iPhone rise, while Cisco Systems (CSCO) should get a lift from the new tax law.

PG&E looks like a buy– A sharp drop last week in shares of PG&E (PCG) could present a buying opportunity, Andrew Bary writes in this week’s edition of Barron’s. Shares of California utilities Sempra Energy (SRE) and Edison International (EIX) also fell this past week amid concerns about their liability for this month’s wildfire outbreak in Southern California, Barron’s adds.

Investors should give REITs a chance – Income investors should give real estate investment trusts a chance, Bill Alpert writes in this week’s edition of Barron’s. Among REITs with nice payouts are Macerich (MAC), Simon Property Group (SPG), Agree Realty (ADC), National Retail Props (NNN) and Realty Income (O), he contends

Western Digital (WDC) could be worth $120 – Flash-memory prices are expected to fade in 2018, which has worried investors in Western Digital, Andrew Bary writes in this week’s edition of Barron’s. However, at $83, Western Digital shares look undervalued, as the stock could be worth $120 at $10 a share in free cash flow, Bary notes.

BEARISH  MENTION

 Bitcoin bourses should be avoided by small traders – Derivatives exchanges Chicago Board Options Exchange (CBOE) and CME (CME) recently launched futures trading on the digital cryptocurrency bitcoin, but these securities do not trade actual bitcoin and are instead based on indexes of bitcoin prices that are calculated differently, Theresa Cary writes in this week’s edition of Barron’s. Putting aside the risk reflected in last week’s bitcoin plunge, these are not retail-friendly products in their current form, she notes, adding that market observers expect that to change over the next six months.

Cryptocurrency mania may not end well – Cryptocurrency mania is obvious in the stock market activity of companies like beverage seller Long Island Iced Tea (LTEA), with shares soaring after the company said it would change its name to Long Blockchain, Vito Racanelli writes in this week’s edition of Barron’s. The real risk is regulatory as governments around the world will gradually see the cryptocurrencies as a threat to their fiat currencies and policies, he notes, adding that it is a mania and eventually the bubble will pop amid tears.


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Barron’s is bullish on Alaska Air

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

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Stockwinners offers Barron’s review of stocks to buy, stocks to watch

BULLISH  MENTIONS

Alaska air should bounce back in 2018 – While shares of Alaska Air (ALK) are down over 20% this year, they should get back up in 2018, Strauss writes in this week’s edition of Barron’s. With a lower valuation and a better dividend yield than many rivals, the company should rise after if fully integrates Virgin Air, which already is adding to earnings, he notes.

CBOE should not be treated as ‘set and forget’  – Bitcoin futures have pushed CBOE’s (CBOE) stock to a new record high, and some see the stock as a way to benefit from investors fascination with Bitcoin, Steven Sears writes in this week’s edition of Barron’s. However, Sears is recommending that investors no longer treat the shares as a “set and forget” position until it is clearer how the Bitcoin ecosystem will influence CBOE.

Spark Therapeutics selloff may be overdone – Spark Therapeutics (ONCE) shares plunged after the company released disappointing results for its hemophilia A treatment, but the selloff may be overdone given the company’s other promising treatments, Andrew Bary writes in this week’s edition of Barron’s.

More consolidation to come after Disney/Fox deal – Netflix (NFLX) success and its high valuation is forcing the rest of the TV work to scramble, Alex Eule writes in this week’s edition of Barron’s. In the wake of Disney’s (DIS) 21st Century Fox (FOXA; FOX) purchase, investors should expect more consolidation to come, he adds. Given that FOX RSN business looks very similar to MSG Networks (MSGN) and with Disney’s deal spurring a new wave of RSN interest, 208 could be the year that MSG gets sold, Barron’s says. Other potential attractive targets include AMC (AMCX) and Viacom (VIAB), Eule contends.

BEARISH  MENTIONS

Exxon (XOM) disclosure of climate-change regulation impact has risks – In a filing with the Securities and Exchange Commission, Exxon’s board acceded to a proxy request to disclose more about what tightening climate-change regulations may do to the long-term value of its hydrocarbon assets in the ground, Vito Racanelli writes in this week’s edition of Barron’s. Once Exxon discloses this information, companies that do not will be under pressure, he notes, adding that while more disclosure as a rule is good for shareholders, there are risks as it could hurt its competitive position and the ability to sell assets at a fair price.

New Apple iPhone features also bring software bugs – While each new Apple iPhone (AAPL) brings more “dazzling” features, it also brings a rising number of software bugs, Tiernan Ray writes in this week’s edition of Barron’s. Apple has little choice but to keep adding features to stay ahead of the pack, and one large cost is having to divert engineers to fix bugs, he adds.


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Apple becomes Finisar’s Santa Clause

Apple awards Finisar $390M from Advanced Manufacturing Fund

Apple awards Finisar $390M from Advanced Manufacturing Fund. Stockwinners.com
Apple awards Finisar $390M from Advanced Manufacturing Fund.

Apple (AAPL) announced that Finisar (FNSR) will receive $390M from its $1B Advanced Manufacturing Fund.

“The award will enable Finisar to exponentially increase its R&D spending and high-volume production of vertical-cavity surface-emitting lasers.

Apple says that Finisar is going to work on both research & development and high-volume production of optical communications components. The most complicated components are the vertical-cavity surface-emitting lasers (VCSELs) used in the iPhone X for Face ID, Animoji, Portrait mode and other face-mapping technologies.

But Finisar also works on proximity sensors including the ones in the AirPods.

And it’s quite easy to understand why Apple is investing in Finisar. There are simply not enough suppliers in this field today. In the fourth quarter of 2017 alone, the company will purchase 10 times more VCSEL wafers than the entire VCSEL production in the world during the fourth quarter of 2016. So Apple needs to foster production.

VCSELs power some of Apple’s most popular new features, including Face ID, Animoji and Portrait mode selfies made possible with the iPhone X TrueDepth camera, as well as the proximity-sensing capabilities of AirPods,” Apple said in a press release.

It added that Finisar will transform a 700,000-square-foot manufacturing plant in Sherman, Texas, into the “high-tech VCSEL capital of the US.”

Apple’s award will create more than 500 high-skill jobs at the Sherman facility.

FNSR closed at $19.30. It last traded at $23.00.


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Canadian Solar receives go-private offer

Canadian Solar announces receipt of ‘go-private’ offer of $18.47 per share

canadian-solar receives going private offer. Stockwinners.com
Canadian Solar receives going private offer

Canadian Solar (CSIQ) announced that its board has received a preliminary, non-binding proposal letter, dated December 9, from its Chairman, President and CEO Shawn Qu, to acquire all of the outstanding common shares of the company not already beneficially owned by Dr. Qu and his wife, Hanbing Zhang, in a “going-private” transaction for cash consideration of $18.47 per common share.

The board has formed a special committee of independent and disinterested directors to consider the proposed transaction.

The company expects that the Special Committee will retain independent advisors, including independent legal and financial advisors, to assist it in this process.

“The Board cautions the Company’s shareholders and others considering trading in the Company’s securities that the Board has just received the Proposal Letter and has not had an opportunity to carefully review and evaluate the Proposed Transaction or make any decision with respect to the Company’s response to the Proposal Letter.

The Board also cautions that there can be no assurance that any definitive offer relating to the Proposed Transaction or any other transaction will be made by Dr. Qu or any other person, that any definitive agreement with respect to the Proposed Transaction or any other transaction will be executed or that the Proposed Transaction or any other transaction will be approved or consummated,” the company stated.

ANALYST COMMENTS

Coker Palmer analyst Brad Meikle believes the offer to take Canadian Solar private by its CEO and Founder “puts in a floor value for the company.” The analyst, however, believes Canadian Solar’s fair value is “significantly higher” than the $18.47 per share offer. If the company does end up going private, it will be at a “significantly” higher price than today’s offer, Meikle tells investors. The analyst notes his fair value estimate for Canadian Solar is $32 per share and his upside target is $45 per share.

CSIQ closed at $18.20.


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Sigma Designs sold for $282 million

Silicon Laboratories to acquire Sigma Designs for $7.05 per share

sigma design sold for $282M. Sockwinners.com
sigma design sold for $282M.

Shares of Sigma Designs (SIGM) jumped in morning trading after Silicon Laboratories (SLAB) agreed to acquire the company for about $282M.

The deal comes after Sigma reported weaker than expected quarterly results, and several months after an analyst speculated about a potential deal.

BACKGROUND

In a June 7 note, Benchmark analyst Gary #Mobley speculated that Sigma Designs could be a “prime acquisition target” for Silicon Labs or MaxLinear (MXL) if it shed assets to become a pure play IoT chip/cloud infrastructure.

Mobley said if Sigma was not acquired, but was able to raise $100M by selling non-core, non-IoT businesses, Sigma could make additional acquisitions to strengthen its IoT focus.

ACQUISITION ANNOUNCEMENT

After the market close on Thursday, Silicon Labs announced that it will buy Sigma Designs for $282M, or $7.05 per share in a cash transaction.

The deal, which is subject to certain closing conditions, is expected to close in the first calendar quarter of 2018. Key to the deal is Sigma’s Z-Wave IoT technology for smart home solutions, and Silicon Labs CEO Tyson Tuttle commented that

“By adding Z-Wave technology to Silicon Labs’ connectivity portfolio, we will be better positioned to serve this fast-growing market.”

Silicon Labs intends to work in collaboration with the Z-Wave Alliance to drive adoption and development of Z-Wave technology, it said.

In the event the closing conditions are not met, Sigma said it will sell its Z-Wave business to Silicon Labs for $240M.

In addition, Sigma said it plans to divest or wind down its Smart TV business, and is in active discussions with prospective buyers to divest its Media Connectivity business. Separately, Sigma Designs reported a third quarter loss per share of (25c) on revenue of $33.9M, missing analysts’ consensus estimates of (15c) and $38.55, respectively.

WHAT’S NOTABLE

In July, Sigma Designs said it had engaged Deutsche Bank as a financial advisor to explore strategic alternatives, including continuing with its restructuring plans, selling or spinning off certain products or the sale of the company.

In October, the company announced major restructuring activities to streamline the Connected Smart TV Platforms business and accelerate a return to profitability. As a result, Sigma said it planned to cut 200-250 jobs.

REACTION:

Weighing in on the acquisition announcement, Benchmark’s Mobley downgraded Sigma Designs this morning to Hold from Buy, telling investors that the 26% takeover premium from Silicon Labs is a good deal for shareholders. Sigma shares were also downgraded to Hold from Buy at Craig-Hallum and Lake Street.

Craig-Hallum’s Richard Shannon called the deal a “disappointing outcome,” as he thought the sum of the parts would be closer to $9 per share. He does not see a better price, as he thinks the deal was “well-shopped.”

Lake Street’s Jaeson Schmidt said he is “not surprised” by the news following Sigma’s exploration of strategic alternatives. He sees little risk to getting the deal done.

PRICE ACTION:

Sigma Designs is up nearly 23% in morning trading to $6.88, while Silicon Laboratories is up about 0.33% to $90.50.

OTHERS TO WATCH:

MaxLinear, a company that had been rumored to be a potential suitor for Sigma, is up 1.5% to $25.37 in Friday’s trading.


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Barron’s is bullish on Verizon

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

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BULLISH  MENTIONS

 

Rising sales may lift Mondelez (MDLZ)- There is reason to hope that growth is returning to Mondelez, with sales perking up in its latest quarter, especially in the developing markets, Bill Alpert writes in this week’s edition of Barron’s. If the company and its new CEO can deliver sales growth, many analysts think Mondelez’s stock could rise to $50 or more, the report notes.

Wheat prices may rise amid cold December – A “brutal cold snap” in December is likely and could lift winter wheat prices higher than $5 a bushel, a rally that would aid the farm economy that has been hurt by steadily falling wheat prices since mid-2012, Simon Constable writes in this week’s edition of Barron’s. Among companies that benefit from higher crop prices are fertilizer makers Mosaic (MOS) and Agrium (AGU), the report notes.

Infrastructure stocks should rise if Congress passes legislation – It may be easy to be skeptical about President Donald Trump’s ambitious effort to rebuild aging bridges, roads and other elements of the country’s infrastructures, but there is reason for hope, John Kimelman writes in this week’s edition of Barron’s. For investors in a group of about a dozen infrastructure companies such as Vulcan Materials (VMC) and Fluor (FLR), legislation cannot be considered soon enough, he contends. Other companies that may get meaningful boosts include Martin Marietta Materials (MLM), Aecom (ACM), Jacobs Engineering Group (JEC), Granite Construction (GVA), Eagle Materials (EXP), and U.S. Concrete (USCR), Barron’s notes, adding that even equipment companies like Caterpillar (CAT) could benefit.

Tencent still has upside – While Tencent (TCEHY) is up 125% this year, the stock still has lots of upside, Assif Shameen writes in this week’s edition of Barron’s.

Verizon could return 20% over the next year – A long price war in wireless is easing, which has left Verizon’s (VZ) shares looking cheap, Jack Hough writes in this week’s edition of Barron’s. They could return 20%, including a dividend yield of 5%, over the next year, he adds.

BEARISH  MENTIONS

Challenges at HP Enterprise loom large– In a follow-up story, Barron’s says that as HP Enterprise (HPE) CEO Meg Whitman prepares to retire in February, the company no longer “has to shut the lights at night to save money.” However, plenty of challenges remain, notwithstanding Whitman’s moves to reconfigure the business, the report notes. The challenges at HP Enterprise loom large, as cloud-computing leaders Amazon (AMZN), Microsoft (MSFT) and Alphabet’s (GOOGL; GOOG) increasingly buy less HPE gear because they are building their own, the report notes.


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DOJ to block AT&T and Time Warner’s merger

Analysts cut Time Warner, AT&T targets following DOJ lawsuit

Time Warner Name to Become History, See Stockwinners.com Market Radar

Following the news that the U.S. Department of Justice is suing to block AT&T (T) and Time Warner’s (TWX) merger deal, several Wall Street analysts lowered their price targets for both names.
Nonetheless, Baird analyst William Power argued that he sees the merits of the antitrust case favoring AT&T.

DOJ LAWSUIT

Yesterday, the U.S. Department of Justice announced that it is suing to block the deal agreed to between AT&T and Time Warner.
Commenting on the news, AT&T’s Senior Executive VP and General Counsel David McAtee II said the DOJ lawsuit is “a radical and inexplicable departure from decades of antitrust precedent.”
He added: “Vertical mergers like this one are routinely approved because they benefit consumers without removing any competitor from the market.
We see no legitimate reason for our merger to be treated differently. […] Fortunately, the Department of Justice doesn’t have the final say in this matter. Rather, it bears the burden of proving to the U.S. District Court that the transaction violates the law. We are confident that the Court will reject the Government’s claims and permit this merger under longstanding legal precedent.”

PRICE CUTS

In light of the news that the DOJ will be suing to block the merger, Wells Fargo analyst Marci Ryvicker lowered her price target for Time Warner to $84 from $100 to reflect its standalone value.
Looking at Time Warner purely on fundamentals, the analyst told investors that she is not totally sure 2018 estimates are accurate given that the company has given no sense of trends for next year.
While #Ryvicker acknowledged that many investors have asked what Time Warner is worth, she does not think anyone steps in for it. The analyst reiterated a Market Perform rating on Time Warner’s shares.
Her peer at Barclays also cut his price target for Time Warner to $92 from $107.
Analyst Kannan #Venkateshwar argued that the DOJ move “in effect goes against almost 40 years of judicial commentary and action and, therefore, is quite unprecedented.”
Based on past DOJ frameworks, the analyst believes it may be tough for it to establish competitive harm, but the companies are likely in a 4-6 month period of litigation that should delay not only the closing of the deal but may also “chill other M&A activity across the space.”
Absent a deal, Venkateshwar estimates Time Warner could trade at $77 per share.
Meanwhile, Nomura Instinet analyst Jeffrey Kvaal lowered his price target for AT&T shares to $42 from $45 as he considers shares on fundamentals, while noting that he did not cut his target post the third quarter video miss given the pending deal.
Nonetheless, Kvaal told investors he believes the shares have “room to run” with or without Time Warner.

CASE MERITS FAVOR AT&T

Commenting on the lawsuit, Baird analyst William Power argued that the merger deal may be delayed, but is not dead.
The analyst argued that with Facebook (FB), Google (GOOG; GOOGL), Amazon (AMZN) and Netflix (NFLX) now media forces, including in original content, he finds it difficult to believe that AT&T will be able to significantly raise pricing for the Turner properties or HBO and risk driving away current partners.
Ultimately, Power believes the merits of the case favor AT&T. The analyst reiterated an Outperform rating and $42 price target on AT&T shares.

PRICE ACTION

In Tuesday’s trading, shares of Time Warner have gained over 1% to $88.79 while AT&T is fractionally down to $34.42 per share.


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Fitbit is selected by the National Institutes of Health

Fitbit selected by NIH precision medicine research program

fitbit is selected by the National Health Institute. See Stockwinners.com for details

Fitbit (FIT) announced it has been selected as the first wearable for use in the national All of Us Research Program established by the White House in 2015.

This project is funded by a supplement to a funding award from the National Institutes of Health to The Scripps Research Institute.

All of Us Research Program seeks to enroll one million or more participants to accelerate research that may improve the ability to prevent and treat disease based on individual characteristics.

Researchers will use data gathered from the program to learn more about how individual differences in lifestyle, environment and biological makeup can influence health and disease.

As a subset of the All of Us Research Program, the Scripps Translational Science Institute leads The Participant Center, a unit tasked with enrolling and engaging diverse populations across the country.

Through this network, STSI will provide up to 10,000 Fitbit Charge 2 and Fitbit Alta HR devices to a representative sample of All of Us volunteers for a one-year study. At the end of the study, the researchers will provide recommendations on how the devices could be more broadly incorporated into the All of Us Research Program.

Additionally, the study will generate a data set that presents a unique opportunity to explore the relationship between health indicators such as physical activity, heart rate and sleep in conjunction with other critical health outcomes that will be captured as part of All of Us.

FIT closed at $6.06.


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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:

Stockwinners offers Barron's review of Stockwinners offers stocks to buy, stocks to watch, upgrades, downgrades, earnings, Stocks to Buy On Margin

 

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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Seagate enhances its video surveillance business

Seagate launches first drive for AI-enabled surveillance

 Seagate launches first drive for AI-enabled surveillance. See Stockwinners.com for details

Seagate (STX) has announced its SkyHawk AI hard disk drive, the first drive created specifically for artificial intelligence enabled video surveillance solutions.

#SkyHawk AI provides unprecedented bandwidth and processing power to manage always-on, data-intensive workloads, while simultaneously analyzing and recording footage from multiple HD cameras.

Analytics on video surveillance hardware is growing exponentially, forecasted to increase from 27.6 million shipments in 2016 to 126M shipments in 2021, as hardware manufacturers continue to include analytics sensors on network video recorders.

This will only increase as AI – particularly deep learning and machine learning applications, such as facial recognition and analyzing irregularities in behavior – become increasingly prevalent.

In parallel, the need for fast video analytics will continue to rise, increasing the workload burden on NVR storage. SkyHawk AI is ideal for intensive computational workloads that typically accompany AI work streams, as its high throughput and enhanced caching deliver low latency and excellent random read performance to quickly locate and deliver video images and footage analysis.

This enables on-the-edge decision making, eliminating the latency of exchanging cloud-based data and processing. Equipped with Seagate #ImagePerfect AI firmware, the drive reliably records high quality, sharp video footage with no dropped frames, while simultaneously facilitating AI-enabled NVR analytics – ensuring that intelligence gathered through video surveillance footage is not lost.

SkyHawk AI is now shipping to customers worldwide through appointed authorized distributors.

The SkyHawk AI hard drive is available in both 10TB and 8TB capacities and has a Manufacturer’s Suggested Retail Price in the U.S. of $449.99 and $349.99, respectively.

STX closed at $36.90.


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Barron’s is bullish on biotechs, Target

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

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BULLISH  MENTIONS

Local Chinese consumer plays to have significant advantages – China’s 19th Communist Party Congress gave expanded powers to President Xi Jinping to wield in a second five-year term as the country’s leader, endorsing the continued shift of China’s economy toward domestically focused consumer goods and services, which should be bullish for stocks such as Alibaba (BABA) and China Life Insurance (LFC), John Kimelman and Assif Shameen write in this week’s edition of Barron’s. Meanwhile, U.S. companies with footholds in the country’s consumer markets can expect to face regulatory and other roadblocks in the years ahead, they add.

Biotech selloff creates buying opportunity for investors – Biotech companies are not looking that healthy, with Amgen (AMGN), Biogen (BIIB), Celgene (CELG), and Gilead Sciences (GILD) all offering disappointments of one kind or another, but the selloff has created a buying opportunity for investors, Ben Levisohn writes in this week’s edition of Barron’s. Biotech looks like a victim of high expectations and could be ready to run again, he adds.

Tech giants continue to exploit their dominance – The latest earnings, particularly from Amazon.com (AMZN), Alphabet (GOOGL; GOOG), and Microsoft (MSFT), show that tech giants continue to exploit their dominance to Wall Street’s amazement, Tiernan Ray writes in this week’s edition of Barron’s. All three are examples of network effects, the ability of a business to exploit its position in a kind of virtuous cycle, and the payoff continues to astound Wall Street, he adds, noting that Apple (AAPL) is expected to report earnings this Thursday.

Playing double-up strategy with GE worth considering – General Electric (GE) stock is down 34% this year and seems poised to trade even lower amid fears that it may cut its dividend, Steven Sears writes in this week’s edition of Barron’s. While Sears has profitably recommended wagering against the stock since May, and still thinks bearish trades make sense, he recognizes that many investors feel stuck with their GE holdings and are not sure what to do. The “humble double-up strategy” is worth considering for anyone who wants to maintain ownership of the stock, and also realize a tax loss, he argues.

Target shares could return up to 30% amid renovation – Target’s (TGT) missteps have cost the company $15B in stock-market value over the past three years, Vito Racanelli writes in this week’s edition of Barron’s. The retailer is now remodeling stores, cutting costs and ramping up its online business to combat Amazon (AMZN), and store traffic and earnings look poised to rise in coming years, which could lead to an upward revaluation of the shares, he adds.

May be ‘lots to be gained’ from CVS/Aetna possible tie-up – In a follow-up story, Barron’s says that while CVS Health (CVS) shares were under pressure following a report by The Wall Street Journal saying the company and Aetna (AET) were in talks, there is “lots to be gained from a tie-up.” By securing better drug pricing from CVS than it gets now, Aetna stands to win more health-plan customers, and it can send many of them to CVS for drugs but also for care, the report explains, adding that the deal would help transform CVS into a company that also profits from health outcomes. Further, Barron’s argues that it could help protect it from future changes in health-care law, and from losing sales to Amazon (AMZN).

Enterprise Products Partners promises growth, income – Enterprise Product Partners (EPD) is a leader among U.S. energy master limited partnerships but its units are depressed like those of many peers, with investors worrying about slowing growth, competitive pressures, weak energy prices and cuts or moderating gains in distributions, Andre Bary writes in this week’s edition of Barron’s. However, he argues that compared with other MLPs, Enterprise has better corporate governance and a stronger sheet, offering an “enticing yield” of nearly 7% and a good growth outlook that investors should see as a “winning combination.”

Apple iPhone X may be catalyst for Sony – Long ago considered a rival of sorts for Apple (AAPL), Sony (SNE) has instead emerged as one of its key suppliers, but its stock is up just 10% over the past six months, while other suppliers have seen their shares almost double in the same period, Assif Shameen writes in this week’s edition of Barron’s. Sony supplies iPhone X’s12-megapixel camera, as well as state-of-the-art 3-D sensors designed to boost iPhone’s Face ID and augmented-reality capabilities, he adds, noting that Jefferies analyst Atul Goyal believes these attributes merit a re-rating for the shares, which he thinks can rise at least 40%.

Shire bear case may be too extreme – While Shire (SHPG) has struggled against generic pressures and rising competition, the bear case may be too extreme, Victor Reklaitis writes in this week’s edition of Barron’s.


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Barron’s is bullish on Morgan Stanley and Samsung

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

Stockwinners offers Barron's review of Stockwinners offers stocks to buy, stocks to watch, upgrades, downgrades, earnings, Stocks to Buy On Margin

 

BULLISH  MENTIONS

Caesars looks ready to grow again – After a disastrous 2008 leveraged buyout, Wall Street seems to have warmed to Caesars (CZR) story this year in a strong market for casino operators, Andrew Bary writes in this week’s edition of Barron’s. With a bankruptcy filing settled, the company’s shares have surged this year, and the gambling giant could hit $18, up 50% in the next 18 months, he adds.

Coach shares look undervalued, could rise nearly 30% – Coach (COH), which has announced that it would be changing its name to Tapestry, is finally on the right path to growth, Emily Bary writes in this week’s edition of Barron’s. Recent acquisitions and brand-loyalty initiatives should help the company maintain its market share, and in the next 12 months the shares could return nearly 30%, including dividends, she adds.

DowDuPont shares likely to return as much as 30% over next year – If DowDuPont (DWDP) can cut $3B from its yearly costs and attract a higher valuation by splitting into three parts, the shares stand to return 15%-30% over the next year, including dividends, Jack Hough writes in this week’s edition of Barron’s.

Lufthansa has more room to climb – Amid competitor’s troubles, Lufthansa (DLAKY) has scored an “upgrade to first class,” Victor Reklaitis writes in this week’s edition of Barron’s. However, several bulls say other factors will be bigger drivers, seeing the stock’s price rising to $35.36 due to a range of tailwinds, and implying a rally of about 20%, he adds.

Another 20% gain in Morgan Stanley stock likely – In a follow-up story, Barron’s says Morgan Stanley’s (MS) strategic response to the financial crisis proves more resilient than others,’ and another 20% gain in the stock is likely.

Samsung has lots of upside driven by chips/screens – Samsung (SSNLF)  stock is up 50% this year and it is still cheap, Assif Shameen writes in this week’s edition of Barron’s. While the company is known for smartphones, Samsung lives off semiconductors and screens, with analysts estimating that chips will generate 70% of profits and screens 13%, he adds.

BEARISH MENTIONS

Market pounds United, sees American/Delta as possibly safe bets – United Continental’s (UAL) earnings were bad news for the company, with shares dropping after the carrier reported better than expected earnings but offered guidance that suggested that its fourth quarter earnings would miss, Ben Levisohn writes in this week’s edition of Barron’s. While Delta Air Lines (DAL) and American Airlines (AAL) followed their peer lower, their shares did not go much lower, as the Market seems to see the two airlines as possibly safe bets, he adds.

Regulators inquiries fuel speculation about big tech breakup – Facebook (FB), Amazon (AMZN) and Alphabet (GOOG; GOOGL) deserve a lot of the credit for last week’s record stock market highs but their positive effect will now depend on how they respond to U.S. and European regulators, Tiernan Ray writes in this week’s edition of Barron’s. European inquiries and those from the U.S.’s Federal Trade Commission have prompted speculation about the breakup of these companies, he adds. And it is not only antitrust issues that are in play, as many see the huge amounts of personal data that these companies are amassing as troubling, Ray contends.


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Nokia and Amazon join forces

Nokia announces strategic collaboration with Amazon Web Services

Nokia Gets $2 Billion from Apple. See Stockwinners.com Market Radar

Nokia (NOK) announced a strategic collaboration with Amazon Web Services, or AWS, (AMZN) that will accelerate the migration of service provider applications to the cloud and drive digital innovation for large enterprise customers.

Nokia and AWS are working together to bring a unique and powerful set of solutions that will enable service providers to implement cloud strategies faster leveraging Nokia’s expertise in wireless, wireline and 5G technologies.

The two companies will work to deliver differentiated solutions using Nokia SD-WAN and its IMPACT IoT platform in combination with AWS Greengrass, machine learning and artificial intelligence services.

The scope of the agreement announced today covers four areas of collaboration: Nokia will support service providers in their AWS implementation strategy with a complete suite of services including consulting, design, integration, migration and operation for infrastructure and applications.

Nokia and AWS will work together to generate new 5G and Edge Cloud strategies and guidance for customers including reference architectures that enable both service providers and enterprises to benefit.

Nokia and AWS are working to bring an improved user experience for Nuage Networks SD-WAN customers who use AWS.

Enterprises can benefit from this seamless integration with AWS and launch secure branch connectivity in hybrid environments with “Single Pane of Glass” capabilities.

Finally, the companies are commercializing IoT use cases with AWS Greengrass, Amazon Machine Learning, Nokia Multi-access Edge Computing and Nokia IMPACT platform.


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Intralinks sold for $1 billion

Siris Capital affiliates to acquire Intralinks from Synchronoss for $1B

Synchronoss sells Intralin for $1 billion. See Stockwinners.com for details

Siris Capital Group announced that investment funds affiliated with Siris have entered into a definitive agreement to acquire 100% of the common stock of Intralinks Holdings, a wholly owned subsidiary of Synchronoss Technologies (SNCR).

Investment funds affiliated with Siris have also entered into a definitive agreement to make an investment in convertible preferred equity of Synchronoss.

Under the terms of the agreements, investment funds affiliated with Siris will acquire all of the stock of Intralinks for approximately $1B in consideration and Intralinks will become an independent, privately owned portfolio company of investment funds affiliated with Siris.

Under the terms of the agreements, investment funds affiliated with Siris will make an investment in convertible preferred equity of Synchronoss in an amount of $185M.

Siris’ investment would initially be convertible into approximately 19.8% of Synchronoss’ common stock and would involve certain approval and governance rights, including with respect to the composition of the board as well as certain consent rights relating to the company.

The investment in Synchronoss is subject to specified closing conditions, including the closing of the sale of Intralinks, the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act and other foreign antitrust regulatory approvals, as well as certain other regulatory conditions.

The investment is expected to be consummated in the first quarter of 2018.

Equity financing will be provided by investment funds affiliated with Siris and certain co-investors.

Committed debt financing for the Intralinks transaction will be provided by RBC Capital Markets, Golub Capital, and Macquarie Capital. Evercore, Macquarie Capital, Moelis & Company LLC, and RBC Capital Markets are acting as financial advisors to Siris.

Wachtell, Lipton, Rosen & Katz is acting as corporate counsel to Siris and Greenberg Traurig, LLP is acting as financing counsel to Siris in connection with the transactions.Goldman Sachs & Co. and PJT Partners are acting as financial advisors and Gunderson Dettmer Stough Villeneuve Franklin & Hachigian, LLP is acting as legal advisor to Synchronoss in connection with the transactions.

SNCR closed at $13.73.


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