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Bank of America says there are still plenty of buying opportunities in tech stocks. The investment bank says there are very attractive buying opportunities in stocks like Apple ahead of its quarterly earnings this week. CNBC Pro pored through Bank of America’s research and found buy-rated tech stocks with more room to upside. Those stocks include: Microsoft, Apple, Micron Technology, Shopify and Sea Limited. Bank of America recently raised its price target on the iPhone maker to $256 from $230. Analyst Wamsi Mohan says Apple is firing on all cylinders ahead of the so-called “refresh iPhone cycle.” The bank’s recent survey shows that Apple’s iPhone user base is ready to upgrade to products that include AI features. The bank says brand loyalty is critical. “14% of US respondents said they plan to buy an Apple Vision Pro,” Mohan wrote. Apple is scheduled to report earnings next Thursday (Aug. 1). “We reiterate our buy rating as the iPhone cycle is expected to last for many years, driven by GenAI, strong services growth and margin expansion,” he said. Shares are up 13.2% this year. Shopify Bank of America says now is the time to buy shares of the Canadian corporate website provider. Analyst Brad Sills recently upgraded Shopify to buy from neutral because “more balanced growth and margins” are playing out. Sills said the company’s transformation under its new chief financial officer is also underway with the release of quarterly results in early August. “Revenue growth and disciplined spending suggest healthy margin expansion ahead,” he wrote. Sills believes Shopify has many competitive advantages that bode well for significant market share gains ahead. “Shopify appears well-positioned to continue to capture e-commerce market share while achieving better scale and (free cash flow) conversion,” he continued. Shares are down 23% this year. Shares of Sea Limited, a Singapore-based tech internet company, are up 61% this year, but have more room to run, Bank of America said. Analyst Sachin Salgaonkar urged clients to stay calm because trends show the company’s gaming and Shopee units are improving. Shopee is Sea’s Southeast Asian e-commerce platform. “We believe the company has a strong opportunity to take advantage of Southeast Asia’s e-commerce boom given its increasingly dominant online marketplace (Shopee), while its expansion in Brazil offers further long-term growth potential,” he wrote. The bank said losses are bottoming out, while also acknowledging that the competition Sea faces is real. Still, the Wall Street firm reiterated its buy rating and urged clients to hold the stock for the long term. “We see stable competitive trends in the region and expect acquisition rates to increase,” he added. Sea is expected to report quarterly earnings in August. Micron “AI drives strong pricing, mix and upside opportunities. We were pleased to host Micron CFO Mark Murphy, CVP Satya Kumar and IR Samir Patodia for investor meetings in Boston and New York, which were well attended. The key messages were very positive: pricing, visibility, supply discipline and mix improvements to enable differentiated AI compute and enterprise storage offerings.” Microsoft “We believe Microsoft is well-positioned to deliver sustained low-double-digit growth over the next 3-5 years driven by continued adoption of its Azure cloud infrastructure platform, cloud-based Office 365 productivity suite, and higher-margin gaming and Game Pass revenues in Xbox.” Sea Limited “We believe Microsoft is well-positioned to ride the Southeast Asia e-commerce boom given its increasingly dominant online marketplace (Shopee), while its expansion in Brazil offers further long-term growth potential. … We see stable competitive trends in the region and expect adoption rates to improve.” Apple “Strong iPhone multi-year refresh cycle and aging installed base; order book at $256. … We reiterate our Buy rating based on expected multi-year iPhone cycle, driven by GenAI, strong Services growth, and margin expansion. … 14% of US respondents said they plan to purchase an Apple Vision Pro.” Shopify “Revenue growth and disciplined spending suggest healthy margin expansion ahead. … Shopify appears well-positioned to continue to capture e-commerce market share while achieving better scale and FCF conversion. … More balanced growth and margins.”
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