TipRanks’ Best-Performing Tech Analysts Give Their Insights on Top Stocks
Every year we cover the Consumer Electronic Show (CES), aka the biggest tech show on earth. And this year it’s no different. The 2018 CES show has just wrapped up in Las Vegas. The world’s biggest and smallest tech companies (bar Apple) have now unveiled all their hottest and most futuristic products.
Much of the media attention has focused on the weird and the wonderful, see for example Samsung’s gigantic wall TV, the world’s first pole dancing robots and even Modobag’s rideable luggage for cruising through airports in style. Indeed, as hardware becomes more like software we can expect the show to become increasingly absurd as the strangest inventions come to life.
Here at TipRanks we want to find out what investors can learn from this four-day extravaganza. By using TipRanks’ financial accountability engine we curated a list of new ‘CES stock picks’ from highly rated analysts. We rank over 4,700 analysts enabling us to drill down into stock recommendations from only the Street’s best-performing analysts. Note that all these stocks (except Nvidia) have a ‘Strong Buy’ best analyst consensus, based on ratings from the last three months. Bearing this in mind, let’s take a closer look now:
ON Semi (NASDAQ:ON)
Top Needham analyst Rajvindra Gill left CES singing the praises of ON Semi. This silicon solutions company is heavily involved in the fast-growing electrical vehicle (EV) market and self-driving cars market. For example, while at CES the company launched a new range of scalable image sensors for ADAS (advanced driver assistance systems).
“We came away from the talks confident that ON has one of the best portfolios to address the high growth ADAS and EV markets within automotive through maintaining leadership in camera sensors and the development of Silicon Carbide for EVs.”
Gill says that he believes ON continues to win upwards of 70% of new camera based ADAS designs, including partnerships with Intel, Baidu, and NVDA. He calls the interim gross margin target of 40% “fairly beatable” and sets his sights on margins shifting to 45% over time. On January 12 he reiterated his buy rating with a $25 price target. Note that this is a top analyst to follow. TipRanks shows that Gill scores a very impressive 78% success rate and 35% average return across his ON ratings.
Cypress Semicon (NASDAQ:CY)
Mizuho Securities analyst Vijay Rakesh hosted an upbeat dinner at CES with CY’s CEO, Hassan El-Khoury, and CFO, Thad Trent. The meeting increased his confidence in the 2018 outlook for chipmaker Cypress Semicon. He says:
“CY should have another strong year in 2018 as GM [general motors] moves to an attractive ~48%, a multi-year high. We believe its focus on Automotive, Type-C and IoT could drive continued fab utilization and gross margin improvements.”
With continuing strength and no signs of double ordering, he concludes: “a 2.6% dividend yield and a reasonable valuation make CY an attractive opportunity.” Consequently, he bumped up his CY price target $2 to $20 (17% upside potential). Note that Rakesh isn’t alone, Loop Capital’s Betsy Van Hees has also called the stock one of her favorite mid-cap ideas for 2018.
Marvell Technology Group (NASDAQ:MRVL)
Semiconductor solutions company Marvell is “still underappreciated” according to five-star Oppenheimer analyst Rick Schafer. After sitting down with management, he says the company is pivoting to organic growth with new products, a better cost structure and a focused portfolio.
“We remain long-term buyers of this still nascent turnaround story, believing Marvell represents a combination of growth, self-help, margin and FCF expansion under one roof…still trading at a stale and tough-to-justify discount to peers.”
Jefferies’ Mark Lipacis agrees. Following CES he reiterated his buy rating with a $28 price target (17.5% upside from the current share price). Lipacis is positive about 1) secular trends in its core business and 2) the pending $6 billion acquisition of rival chipmaker Cavium (CAVM).
Nvidia (NASDAQ:NVDA)
The list wouldn’t be complete without Nvidia, one of the world’s most famous chipmakers- and one of the most-talked about companies at the event this year. Wearing his trademark leather jacket, CEO Jensen Huang kicked off CES with a press event webcast followed by an unscripted monologue Q&A on the Thursday.
Huang announced a new chip custom-built for self-driving cars, which already boasts more than 320 partners including a huge partnership with Uber. It also announced a TV-sized gaming monitor and a new PC beta of its GeForce Now service for streaming games to low-speed computers.
“Yesterday we met with Colette Kress, CFO, and Shawn Simmons, IR, of NVDA at CES. We came away from the talks with a renewed confidence that NVDA is the leader in autonomous driving hardware. We also heard positive commentary on gaming and saw no reason to change our expectations of a massive opportunity within Data Centers” says Rajvindra Gill. He anticipates 12% upside potential for Nvidia.
In light of the event, top analysts published three buy ratings and one hold rating on NVDA. Overall TipRanks reveals that investors are cautiously optimistic on Nvidia, which has a Street consensus of ‘Moderate Buy.’
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