Microsoft ‘Being Proactive’ When It Unbundled Teams From Office Globally, Macquarie Says

/ / Technology /

Microsoft (MSFT) was “being proactive” when it unbundled Teams from Office globally, Macquarie said in a note Monday, citing a Reuters report on the company’s decision. The company did the same in Europe in 2023 to avoid the scrutiny of antitrust investigators after Slack owner Salesforce (CRM) accused Microsoft of abusing its market power in the operating system space to drive out competitors like Slack in the messaging field. Macquarie said that considering history, it wouldn’t be surprising if the company’s moves on Monday don’t sway the regulators examining Microsoft. “Microsoft’s rationale for the new rollout makes sense,” the firm said, “though we note it is unlikely to deter competitors’ complaints altogether, particularly around the competitiveness of fees and the ongoing ability of Teams-competitive products to natively integrate with the rest of the Office application portfolio.” The firm said that Microsoft’s announcement showed that it is willing to compromise where […]

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CFRA Retains Hold Rating On Shares Of Warner Bros. Discovery, Inc.

/ / Consumer Discretionary /

CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows: We lower our target by $1 to $9, using a narrower risk premium and a forward TEV/EBITDA of 6.24x, below the direct peer average. Adjusted EBITDA is expected to be negative in 1H and then turn positive in 2H 2024. Due to the actor and writer strikes, WBD faces lighter programming content in 2024. WBD is committed to doing a better job with blue-chip movie franchises like Game of Thrones, Harry Potter, and Superman. Free cash flow was $3.3B for Q4 2023 and $6.2B for full-year 2023. We think accelerated growth and profits for MAX video streaming may take longer. We believe the consensus is optimistic with a $13.70 target that suggests a high growth scenario. A year ago, we thought EBITDA would show significant growth in

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Verizon First Quarter to Show Mixed Results, RBC Says

/ / Telecommunications /

Verizon Communications’ (VZ) first-quarter financial results are likely to be mixed, with churn management seen as a key priority for this year, RBC Capital Markets said in a note e-mailed Tuesday. The telecommunications giant is scheduled to report first-quarter results April 22. RBC projects adjusted earnings to fall about 7% year over year to $1.12 per share amid higher interest costs. That result would match Wall Street’s views. The brokerage expects revenue to grow 0.1% to $32.96 billion, below the Street’s $33.3 billion estimate, mainly driven by wireless equipment sales, RBC analysts Jonathan Atkin and Bora Lee said. The firm projects wireless service revenue growth at 3.1% on an annual basis, led by 3.8% average revenue per account growth. The Street is looking for 3.2% and 3.9%, respectively, RBC said. Verizon is also likely to see continued momentum in gross additions, with consumer postpaid phone adds poised to grow 7.4%

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CFRA Maintains Hold Opinion On Shares Of General Motors Company

/ / Consumer Discretionary /

CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows: We raise our 12-month target to $44 from $38, based on a 2025 P/E of 5.2x, a justified discount to historic averages. We lower our 2024 EPS estimate to $8.80 from $8.90 but leave 2025’s unchanged at $8.50. GM posted Q1 U.S. vehicle sales of 594,233 units (-1.5% Y/Y), well below the industry’s expected Y/Y sales growth of 5.5% for Q1, according to Cox Automotive estimates. EVs acted as a drag on overall volumes, declining by 20.5% Y/Y in Q1. Notably, dealership inventories of GM vehicles hit 534,479 units at the end of March, up 17% from year-end 2023 levels, and the highest level since 2020. With inventories rising rapidly, we expect new vehicle prices to remain under pressure and incentives to continue increasing. Furthermore, Q1 results

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Home Depot Acquisition of SRS Presents More Opportunities Than Risks, UBS Says

/ / Consumer Discretionary /

Home Depot’s (HD) decision to acquire SRS Distribution for over $18 billion presents more opportunities than risks for the company, UBS said in a note emailed Tuesday. Despite operating SRS independently, the acquisition will help evolve Home Depot’s perception by making it appear more legitimate in the complex projects market. Last year, Home Depot outlined plans to become a one-stop source for professionals in a $200 billion market segment it termed as “complex” pro projects that require many types of products and multiple days of work. The purchase will help Home Depot gain a deeper understanding of the complex pro customer segment and equip it with the tools necessary to serve the market, UBS said. Meanwhile, the acquisition will be dilutive to Home Depot’s fiscal 2025 earnings per share by 2.3% and then accretive by 0.2% to its fiscal 2026 EPS, the firm noted. UBS maintained a 12-month price target

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Wells Fargo, JPMorgan Named Top Picks by Goldman Sachs for Potential First-quarter Upside Surprise

/ / Financials / ,

By Steve Gelsi Analysts see Wells Fargo and JPMorgan Chase potentially outshining Morgan Stanley, Citi, PNC, U.S. Bancorp and Bank of America JPMorgan Chase & Co. and Wells Fargo & Co. both ranked as top picks on Tuesday among the seven large-bank stocks covered by Goldman Sachs analysts. Goldman Sachs analysts led by analyst Richard Ramsden said JPMorgan Chase (JPM) and Wells Fargo (WFC) have provided “conservative” guidance on their net interest income, which is the profit banks make from loans after they pay out interest for their deposits. The banks are outshining Morgan Stanley (MS), Bank of America Corp. (BAC), U.S. Bancorp (USB), Citigroup Inc. (C) and PNC Financial Services Group Inc. (PNC), which are also tracked by Goldman Sachs. Goldman lifted its price target for Wells Fargo to $65 a share from $57 and hiked its JPMorgan Chase price target to $229 from $215. On average, Goldman hiked

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Intel Expects To Accelerate On Its Path Toward Achieving Ambition Of 60% Non-GAAP Gross Margins And 40% Non-GAAP Operating Margins In 2030

/ / Technology /

Dave Zinsner, Intel chief financial officer, said, “This model is designed to unlock significant cost savings, operational efficiencies and asset value. As it begins to take hold, we expect to accelerate on our path toward achieving our ambition of 60% non-GAAP gross margins and 40% non-GAAP operating margins in 2030. Ultimately, improved cost competitiveness will help us deliver process technology, product and foundry leadership while driving significant financial upside for Intel and our owners.”

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Intel Foundry Losses Expected to Peak This Year After Hitting $7 Billion in 2023

/ / Technology /

By Emily Bary Intel breaks out its product and foundry financials, showing investors their different margin profiles Intel Corp.’s foundry business posted a $7 billion operating loss last year, and the chip company expects losses for that part of its business to peak this year. That’s according to new disclosures made by Intel (INTC) as part of a resegmentation of its business. The company is breaking out the performance of its product and foundry businesses in a bid to help investors better understand the value of each one. Intel’s foundry operating loss steepened in 2023 compared with the $5.2 billion loss that the company posted on the metric in 2022. The company attributed the difference in large part to lower internal revenue for the unit, which in turn weighed on profit potential. The foundry business generated $18.9 billion in revenue in 2023, compared with $27.5 billion in 2022. Shares of

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CFRA Maintains Hold Opinion On Shares Of Lam Research Corporation

/ / Technology /

CFRA, an independent research provider, has provided MT Newswires with the following research alert. Analysts at CFRA have summarized their opinion as follows: We raise our target by $130 to $907, 25.5x our FY 2025 (Jun.) EPS view, near peers but well above LRCX’s three-year average (~17x) on rising AI excitement and an improving memory market outlook. We shift our focus to FY 2025 given expectations of accelerated activity during the year, with node advancements expected in 2024 and subsequent ramps boosting business in 2025, along with our expectation of consistent growth in DRAM to support high-bandwidth memory/AI. We raise our FY 2024 EPS view by $0.03 to $29.36 and our FY 25 view by $0.49 to $35.57, supported by bullish peer commentary in the memory space. We initiate our FY 2026 view at $45.49. Despite positive business fundamentals, we think LRCX remains too pricey to upgrade to Buy at

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