4 big analyst picks: Oracle poised for 'solid' multiyear growth, per Barclays

By Davit Kirakosyan

Here is your Pro Recap of the biggest analyst picks you may have missed since yesterday: upgrades at Oracle, Lowe's, NetApp, and Stryker.

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Oracle pops on Barclays upgrade

Oracle (NYSE:ORCL) shares gained 2.5% Tuesday after Barclays upgraded the company to Overweight from Equal Weight and raised its price target to $150 from $126, as reported in real-time on InvestingPro.

Barclays believes Oracle has multiyear potential for strong growth with high margins as its SaaS and OCI sectors outweigh the lower growth parts of the business. The analysts wrote that the mix effect “should continue to help growth for years to come.”

The analysts also see an opportunity for its cloud operations in the AI space, particularly due to the company’s close ties with Nvidia (NASDAQ:NVDA) and its early adoption of Nvidia's SaaS products.

The company is set to report its Q1/24 earnings on Sept 14.

Lowe's earns an upgrade at Bernstein

Bernstein upgraded Lowe’s (NYSE:LOW) to Outperform from Market Perform on Tuesday and raised its price target to $282 from $252.

The firm now sees a confluence of positive and mutually reinforcing trends for Lowe's that they expect to continue, saying:

We believe LOW will continue to deliver modest op margin expansion over the next 24 months, driven by the continued modest gross margin expansion of 5-10bps / year combined with stable to modestly improving OpEx % of sales.

Bernstein says it is comfortable with the home-improvement market outlook in the near term and that it sees a return to low-single-digit growth into 2024-2025 "as the housing market stabilizes."

Two more upgrades

NetApp (NASDAQ:NTAP) shares gained more than 2% Tuesday after Susquehanna upgraded the company to Positive from Neutral and raised its price target to $100 from $62.

The analysts say they believe NetApp’s product revenue is bottoming and expect to see sequential growth, with a resurgence in year-over-year growth anticipated by mid-2024. They say this is due to the growing demand for SAN-specific AFA technology and share gains in the $18 billion SAN market.

Also on Tuesday, BofA Securities upgraded Stryker (NYSE:SYK) to Buy from Neutral and raised its price target to $315 from $310, commenting:

SYK’s message on margin upside has turned more bullish but the stock has yet to work given all the negative sentiment on medtech which we see as an opportunity now ahead of the 2024 upside.

According to the bank, Stryker's new product cycle could contribute an additional 100-200 basis points to its revenue growth.

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