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Tech Trader Daily: Tech Today: Qualcomm Warns, Downgrading Amazon, Debating WDC -- Barron's Blog

DOW JONES & COMPANY, INC. 10:30 AM ET 4/28/2017

Symbol Last Price Change
CLDR 18.7263down +3.7263 (+24.84%)
QCOM 52.28 -0.93 (-1.75%)
ASML 132.24down +0.5626 (+0.43%)
NINOF 14.14up 0 (0%)
PYPL 47.02down -0.13 (-0.28%)
WDC 88.62down +2.91 (+3.4%)
MS 43.56down +0.02 (+0.05%)
WFC 54.1553up -0.2847 (-0.52%)
AMZN 936.16 +17.78 (+1.94%)
MSFT 68.045 -0.225 (-0.33%)
INTC 36.28 -1.15 (-3.07%)
GPRO 8.45up -0.49 (-5.48%)
QUOTES AS OF 11:16:46 AM ET 04/28/2017
Here are some things going on today in your world of tech:

Shares of Hadoop software vendor Cloudera(CLDR) are set to open for their first day of trading any moment now, after the company priced the deal at $15, above a prior range of $12 to $14.

Shares of Qualcomm(QCOM) are down $1.69, or 3%, at $51.52, after the company this morning slashed half a billion dollars from its outlook for this quarter, saying Apple ( AAPL) continues to interfere with royalty payments the company is owed, and will continue to do so during the legal dispute between the two.

Speaking of litigation, chip equipment maker ASML Holding NV(ASML) fired its counter-shot at Japan'sNikon(NINOF) ( 7731JP), which filed suit against ASML(ASML) on Monday, and against ASML's(ASML) supplier, Germany'sCarl Zeiss SMT GmbH, for infringing on Nikon's(NINOF) patents.

In today's filing, brought in Japan, ASML(ASML) accused Nikon(NINOF) of infringing on 10 of its patents, and said it will file as well in the U.S. CEO Peter Wennink said "We have no choice" after trying "for years" to reach an agreement with Nikon(NINOF).

ASML (ASML) stock is up 36 cents at $132.23.

Speaking of Apple, in case you missed it, Recode's Jason Del Rey wrote yesterday that the company is considering introducing a person-to-person payment system to compete with PayPal's(PYPL) Venmo, writing that it has "recently held discussions with payments industry partners," citing multiple unnamed sources.

Apple shares are down 17 cents at $143.62.

There are a whole bunch of tech earnings from yesterday's D-Day to reflect on.

Shares of hard disk drive and memory chip maker Western Digital(WDC) are up $1.11, or 1.3%, at $86.82, in early trading, after it reported yesterday afternoon fiscal Q3 revenue and profit that topped analysts' expectations, and recovered from early losses, after forecasting this quarter higher as well.

Interestingly, reviews are going in opposite directions, with Morgan Stanley's(MS)Katy Huberty raising her rating on the shares to Overweight from Equal Weight, while Wells Fargo's(WFC)Maynard Um cut his rating to Market Perform from Outperform.

Shares of Alphabet ( GOOGL) and Amazon(AMZN) are both higher in early trading after both companies beat expectations, despite a further decline in Google's ad prices, and Amazon(AMZN) forecast its operating income this quarter in a wide range that was below consensus.

Alphabet's results are leading to target increases, such as Jefferies & Co.'sBrian Fitzgerald raising his to $1,200 from $1,000, writing that "management continues to talk operational discipline, and the valuation continues to look reasonable at 19 times GAAP EPS (ex-cash)."

Amazon's (AMZN) results are also bringing increases, such as Citigroup's Mark May raising his to $1,060 from $960.

However, Pacific Crest's Edward Yruma cut his rating to Sector Weight from Overweight, writing that "cloud competition should intensify through 2017," noting that "Microsoft(MSFT) cloud growth accelerated to 52% y/y on 93% y/y Azure growth."

Alphabet is up $39.19, or 4.4%, at $930.63, while Amazon(AMZN) stock is up $22.84, or 2.5%, at $941.22.

Speaking of Microsoft(MSFT) are up 17 cents at $68.44, recovering from after-hours weakness, following its report of fiscal Q3 revenue that slightly missed analysts' expectations, and a forecast for this quarter's revenue lower as well.

Raymond James's Michael Turits, reiterating a Strong Buy rating on Microsoft(MSFT), raises his price target to $73 from $77, writing that nearly every part of the business was "Solid" aside from the disappointment in sales of Surface computers.

Microsoft's (MSFT) overall gross profit margin is set to expand as its cloud computing margin improves this year, he thinks.

Shares of chip giant Intel(INTC) are down $1.38, or almost 4%, at $36.05, after the company reported Q1 revenue in line with analysts' expectations, and profit that beat by a penny, and forecast revenue and profit this quarter above consensus, and said it added $10 billion to its buyback authorization.

The report has raised concerns about Intel's(INTC) rate of server-chip growth.

Stifel Nicolaus's Kevin Cassidy, reiterating a Buy rating, and a $39 price target, writes that the 6% growth in the unit "is a slow start to management's targeted 8% y/y growth for 2017," and that "investors may have concern" about the 35% operating profit margin.

"We believe both of these issues will be resolved as Intel(INTC) ramps production of its next generation server CPU's, Sky Lake, in 2H17," he writes.

Shares of adventure camera maker GoPro(GPRO) are down 57 cents, or over 6%, at $8.37, after it reported Q1 revenue rose to $218.6 million, topping consensus $208 million, and delivered a net loss a penny better than expected, at 45 cents per share. The company's forecast for this quarter, $260 million to $280 million, was also better.

But some bears are unswayed.

Charles Anderson with Dougherty & Co. writes that the upside came from the company's " Karma" drone product, but that "it's difficult for us to get too excited about Karma upside given its low margins and the fact that GoPro(GPRO) is up against very formidable competition here (i.e., margin expansion is tough to contemplate)."

He thinks the stock's "valuation looks elevated at 1 times enterprise value relative to sales.

More at Barron's Tech Trader Daily blog, http://blogs.barrons.com/techtraderdaily/


(END) Dow Jones Newswires
04-28-171030ET
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