4 big analyst picks: Applied Materials a ‘Top Pick’ at Wolfe

investing.com:

By Davit Kirakosyan

Here is your Pro Recap of the biggest analyst picks you may have missed since yesterday: initiation with Outperform at Applied Materials, and upgrades at Semtech, First Bancorp , and Virtu Financial.

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Wolfe Research initiated coverage on Applied Materials (NASDAQ:AMAT) with an Outperform rating and a price target of $185.00, assigning a Top Pick designation.

We believe AMAT has the most balanced end market exposure among our SCE coverage and is well positioned for a cyclical rebound as both logic and memory spending normalize.

Additionally, the company has significant exposure to legacy node equipment (ICAPS) that is expected to drive structural growth. In the long term, Applied Materials has several secular drivers that are expected to enable it to grow beyond WFE, driven by non-litho innovations such as backside power, GAA, patterning, and packaging/wiring.

Semtech (NASDAQ:SMTC) earned two upgrades after reporting Q2 results that came in better than consensus estimates, while Q3 guidance misses expectations, as reported in real-time on InvestingPro. As a result, shares gained more than 10% yesterday.

Summit Insights upgraded the company to Buy from Hold, noting that the inventory correction in Semtech's signal integrity and protection sector is now in the past. The firm expects sales of 5G wireless IoT products to bottom this quarter.

We expect IoT products inventory correction to be completed in 2H23 and expect a recovery by 1HCY24. While demand recovery may not be straight up and to the right, we think demand recovery can now drive financial outperformance in the next few quarters.

Meanwhile, Susquehanna