Top Wall Street analysts still cut price targets on Red-Hot tech stocks – 24/7 Wall St.
When the going gets tough, the tough guys cut their price targets. It only makes sense. After all, if a stock has fallen by, say, 50% in three or four months, chances are an older price target has been breached.
One of the hardest hit sectors in 2022 is information technology, which is down more than 18%. Analysts are therefore refining their expectations, both before and after the publication of quarterly results by companies. After Alphabet/Google released its results last week, a dozen baker’s brokerages reiterated their equivalent of a buy rating on the stock, but all 13 lowered their price targets.
Here’s a look at four companies reporting earnings this week and two more that could report by mid-May.
Cloudy
Cloud service provider Cloudflare Inc. (NYSE:NET) is up about 3% in the past 12 months as of noon Monday. When the company releases its first-quarter results after markets close Thursday, May 5, analysts expect revenue to rise 6.2% to $205.65 million sequentially and 48.5% from one year to the next. The company is also expected to break even in earnings per share (EPS), just like the prior quarter, and better than the $0.03 per share loss in the prior year quarter.
Analysts at Cowen reiterated their outperform rating on the stock and lowered their price target from $250 to $200 per share. Cowen thinks Wall Street’s revenue estimate is too low, citing strong results from Amazon’s AWS and Microsoft’s Azure cloud service. Cowen analysts expect Cloudflare’s estimates to follow a “beat and rise” pattern in 2022.
The stock traded down about 2% to $87.88 in a 52-week range of $64.84 to $221.64. Since hitting a high of $216.27 in early November, Cloudflare’s consensus price target has dropped to a current average of $153.00.
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Etsy
Online marketplace Etsy Inc. (NASDAQ:ETSY) has fallen more than 52% in its share price over the past 12 months. The shares were trading up about 2.2% ahead of the company’s earnings report, which is expected to be released after markets close on Wednesday. Analysts expect revenue to fall nearly 20% sequentially, while rising 4.4% year over year, as EPS falls 46.7% sequentially and 4.4% year over year.