Earnings season always brings surprises and serves as a catalyst for stocks. Following yesterday evening’s reports, analysts weigh in on casino resort company Wynn Resorts, Limited (NASDAQ:WYNN), video game maker Activision Blizzard, Inc. (NASDAQ:ATVI), cybersecurity firm Cyberark Software Ltd (NASDAQ:CYBR), and Online deal maker Groupon Inc (NASDAQ:GRPN). Below are the ratings along with current price targets and comments.
Wynn Resorts, Limited
In a research report issued today, Deutsche Bank analyst Carlo Santarelli reiterated a Buy rating on shares of Wynn Resorts, with a price target of $82, after the company reported fourth-quarter earnings that beat estimates, as revenue growth in Las Vegas partially offset a decline in the struggling Macau casino.
Santarelli noted, “Given WYNN pre-announced results on 1/15, surprises were limited to the call and we more or less believe the call commentary was guarded, but certainly more constructive than the 3Q15 session.” The analyst continued, “Post the 4Q15 results, our estimates are up modestly for the 1Q16 given high hold in LV in January and a better than expected January in Macau. For 2016, both the LV properties and the Peninsula asset forecasts are modestly higher, though we have pushed back our expected opening of Cotai from late June to mid August as we remain skeptical of an on time opening. Our 2017 forecasts are also higher, driven partially by EBITDA contributions from the new retail attributes in Las Vegas.”
According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Carlo Santarelli has a yearly average return of -3.8% and a 36.4% success rate. Santarelli has a 0.2% average return when recommending WYNN, and is ranked #2899 out of 3564 analysts.
Out of the 7 analysts polled by TipRanks (in the past 3 months), 3 rate Wynn Resorts stock a Buy, while 4 rate the stock a Hold. With a return potential of nearly 33%, the stock’s consensus target price stands at $79.33
Activision Blizzard, Inc.
Activision Blizzard shares are falling nearly 11% in pre-market trading Friday, after the company reported its fiscal fourth-quarter results, posting revenues and EPS of $2.1 billion and $0.83, below consensus expectations of $2.2 billion and $0.86, respectively, as strong core franchise performance was offset by weaker-than-expected casual game sales.
However, Baird analyst Colin Sebastian believes that the noisy quarter could provide an attractive entry point, and reiterated an Outperform rating on the stock, with a price target of $38, which implies an upside of 24.5% from current levels.
Sebastian wrote, “This is the first quarter Activision has missed EPS consensus since before 2011, which we believe magnifies the negative stock reaction. Initial 2016 outlook appears conservative, product slate remains healthy.” Furthermore, “Overall industry trends remain positive, while Activision’s key franchises appear to be selling well. More importantly, Activision appears to have a robust product pipeline in 2016 and 2017, with potential longer-term value generation from the company’s nascent eSports and multimedia initiatives.”
According to TipRanks.com, analyst Colin Sebastian has a yearly average return of 11.6% and a 53% success rate. Sebastian has a 6% average return when recommending ATVI, and is ranked #91 out of 3564 analysts.
Cyberark Software Ltd
Cyberark shares are falling nearly 9% in pre-market trading, after the company posted lower-than-expected guidance for the current quarter. However, the company reported strong fourth-quarter revenue/EPS metrics, beating consensus estimate.
After reviewing the earnings, Oppenheimer analyst Shaul Eyal remains positive on the stock, reiterating an Outperform rating, while reducing the price target to $60 (from $70), to reflect group’s contracting multiples.
Eyal noted, “Revenue of $51.5M (up 42% YoY) beat the consensus estimate of $43.9M, and EPS of $0.39 dwarfed the Street’s $0.20 estimate. Strength was across all geographies and verticals (notable Healthcare, Financials, Airlines & Federal performance). Operating margin of 29.6% also crushed Street’s estimate of 21.9% despite ongoing investments.” The analyst concluded, “With strong business momentum and increasing interest in PAM solutions, CYBR has plenty of tailwinds that could help turn the tide of ongoing high-profile breaches that increasingly target privileged insiders.”
According to TipRanks.com, analyst Shaul Eyal has a yearly average return of 6% and a 52% success rate. Eyal has a -12.3% average return when recommending CYBR, and is ranked #186 out of 3564 analysts.
Shares of Groupon jumped nearly 23% in pre-market trading after the company reported better than expected fourth-quarter results, posting revenue of $917 million, which was 8% above Street estimates.
In reaction, Piper Jaffray analyst Gene Munster raised his price target to $3.00 (from $2.50), while reiterating a Neutral on the stock.
Munster said, “Groupon reported EBITDA of $67M (vs. the Street at $51M) on revenue of $917M (vs. $846M); outperformance vs. the Street was driven by stronger Goods volume offsetting Local & Travel billings below consensus expectations. Cost controls during the quarter were strong as Groupon improved discount management on local deals and began consolidating redundant cost centers. The company is executing on its plans to narrow the business’s focus onto Local deals and, in particular, the North America segment CEO Rich Williams remains focused on cutting “empty calorie” revenues that reduce the focus of the company and generate little or no economics.”
“While we continue to view Groupon’s core headwind as being the need for virality in its local deals product, we believe the company is taking the right steps by divesting, exiting, or abandoning regions and products that distract from its core consumer product,” the analyst concluded.
According to TipRanks.com, analyst Gene Munster has a yearly average return of 13.7% and a 51.7% success rate. Munster has a -15.3% average return when recommending GRPN, and is ranked #15 out of 3564 analysts.