These reports, extracted and edited by Barron’s, have recently been published by investment and research firms. The reports are a selection of the analysts’ thinking. They should not be taken as Barron’s views or recommendations. Some of the issuers of the reports have provided or hope to provide investment banking or other services to the analyzed companies.
Steven Madden [a maker of shoes and apparel] In the first quarter, adjusted earnings of 33 cents per share were reported compared to our and the consensus estimates of 23 cents / 17 cents with an increase in sales of 0.5%. Retail sales increased 27.6% while wholesale sales decreased 3.7% as wholesale shoes decreased 7.8% but wholesale accessories increased 10.3%.
Management found that sales continued to accelerate well into April. We believe this is a sign that consumers are returning to fashionable footwear. Management found that elegant styles are showing a positive trend. We believe there is significant chance of an uptrend later in the year as consumers return to pre-Covid activity. We’re raising our price target for the stock from $ 44 to $ 46.
Dana
DAN-NYSE
Outperform Price $ 27.71 on April 28th
by Oppenheimer
Dana shares were flat for the day after Wednesday [the manufacturer of vehicle components, particularly drivelines] reported first quarter results that exceeded top / bottom line consensus estimates. Dana reported adjusted earnings of 66 cents per share for the first quarter, which was above the consensus estimate of 47 cents. Dana also raised her guidance for FY2021, with earnings per share up 5% on Street’s guidance.
Amid a cyclical upswing in Dana’s end markets, the revised guidance remains conservative about the assumptions about the back half, including the impact of chip scarcity on light vehicle production. While the cost of raw materials (steel, aluminum) and the supply chain increase incremental margin pressure, sequential improvement should mitigate these factors. Investments in the manufacture of electric vehicles appear optimistic for future activities. We are increasing our estimates for the 2021-22 financial year and increasing our price target [from $27] to $ 30.
Pinterest
PINS NYSE
to buy Price $ 77.58 on April 27th
by UBS Global Research
[Shopping and digital-media company] Pinterest’s first quarter earnings and forward comments contained two stories: a solid first quarter report and a second quarter revenue forecast against a backdrop of strong digital advertising versus potential short-term counter-gains in user growth and engagement as the Covid-19 restrictions ease.
Despite this potential short-term volatility, management continues to focus on positioning the business for long-term value creation. Overall, we see Pinterest in the early stages of implementing a myriad of opportunities across a few key industry topics, including moving ad spend from offline to online and blurring the lines between digital ads and e-commerce. We reiterate our Buy recommendation and our price target of USD 100.
Avangrid AG
R-NYSE
Neutral Price $ 50.29 on April 28th
by Mizuho Securities
We are initiating a report on Avangrid with a neutral rating and a price target of USD 52. The Company [which runs electric and natural-gas networks in New York and New England and has renewable-energy facilities in 22 states] has struggled in recent years to meet previously established guidelines in both regulated and unregulated businesses, but recently introduced a new CEO and revised EPS targets.
We believe Avangrid’s robust renewable energy segment (15% of EPS) is adequately reflected in its value for money. We believe the stock is fairly valued as the company needs to establish a pattern for results to be in line with expectations. [The company’s first-quarter earnings call is scheduled for May 4.]
service now
NOW NYSE
Outperform Price $ 557.24 on April 29th
by Macquarie Research
ServiceNow reported a better first quarter and improved future forecasts in constant currencies. However, the noise of exchange rate effects resulted in a visual with reduced leadership, a slowdown in business, and an aggravation of seasonality. These and other dynamics created confusion about the [software] Business metrics, [pushing down the stock]. We are buyers with vulnerabilities and we remain confident that ServiceNow can be the best workflow automation platform of its kind. Our 12 month price target is $ 631.
Under armor
UA NYSE
Outperform Price $ 24.03 on April 28th
from Cowen
We are increasing the price target to USD 30 [from $27]24 times our estimate of earnings before interest, taxes, depreciation and amortization for fiscal year 2022 and 52 times our EPS estimate for fiscal year 2022. Our model assumes that the EPS potential by fiscal year 2024 is north of 1 And the free cash flow is approaching a sustainable run rate of $ 400 million. The Google search trend data for Under Armor accelerated through April and is above the comparable level of 2019. [Under Armour is scheduled to report quarterly results on May 4.]
Coinbase
Global COIN-Nasdaq
to buy Price $ 294.77 on April 29th
from BTIG
Coinbase Global [which specializes in cryptocurrency trading] has agreed to acquire skew, a provider of real-time data visualization and analysis. The terms of the acquisition, which is expected to close in the second quarter, were not disclosed. The addition of Skew will round out Coinbase’s institutional prime brokerage platform, which includes offerings such as custody, OTC trading and participation. We believe Coinbase Prime, which launched in January, has been overlooked by many investors, but has significant advantages as crypto becomes more institutionalized.
We estimate that Coinbase’s subscription and service revenue will grow by around 30% annually from 2021 to 2025. The company had institutional assets of $ 122 billion as of March 31, which is more than half of the total assets of $ 223 billion on its platform as of that date. Coinbase has approximately 7,000 institutional clients, and with Skew they can track the crypto spot and derivatives market in real time. Our price target is $ 500.
LyondellBasell
LYB NYSE
Obesity Price $ 107.49 on April 28th
by Alembic Advisors
LyondellBasell announced its first quarter results this morning: Ebitda of $ 1.59 billion significantly exceeded consensus estimate of $ 1.47 billion; Reported earnings of $ 3.18 per share beat the consensus estimate of $ 2.59. Lyondell [a plastics, chemicals, and refining company] plans to be near full capacity worldwide to meet robust demand, which management is expected to continue due to low inventory levels and maintenance outages in its industry. Lyondell said the strong integrated polyethylene margins in North America are likely to continue as US manufacturers seek to fill domestic backlogs, rebuild inventories and meet export demand.
In order to achieve a 12-month price target for the share, we offer three valuation scenarios. Our trough case assumes a depressive Ebitda [as in 2009, after the 2008-09 recession] of $ 2.5 billion. It generates a stock valuation of $ 31 per share. Our base case is based on our Ebitda estimate for 2021 [$5.76 billion]that generated a goal of $ 120. In our bull case, a peak cycle Ebitda estimate of $ 11.72 billion is used. It generates a valuation of $ 286 per share, highlighting Lyondell’s upside.
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