Equity analysts are weighing in today on fiber optics component maker Acacia Communications (NASDAQ:ACIA), residential solar firm Sunrun Inc (NASDAQ:RUN), and drug maker Cyclacel Pharmaceuticals Inc (NASDAQ:CYCC). Let’s take a look and see what the analysts have to say about these rising stocks.
Acacia Communications, Inc.
Acacia Communications jumped over 35% today due to its relatively robust second-quarter results. On the back of a solid consensus beat thanks to the driving momentum from powerful international demand, Deutsche Bank analyst Vijay Bhagavath reiterates a Buy rating on the stock and boosts the price target from $60 to $90.
Acacia reported second-quarter revenue of $116.2, compared to consensus of $85.8 million. For third quarter guidance, Acacia projects $120 to $128 million in revenue, compared to consensus of $91.7 million. From the analyst’s standpoint, Acacia’s optical modules in Metro and Cloud Datacenter Interconnects have the company’s financials going strong, leading to this “top-line beat.”
Bhagavath asserts, “We are bullish on ACIA’s ‘disruptive’ Optical Networking Growth Story – a +$4-5B Silicon Optical opportunity [DB view]. Our mid term view calls for +30% topline CAGR, high 40s gross margin, low 20s operating margin.” Especially considering this was Acacia management’s first quarter executing as a public company, Bhagavath sings the praises of Acacia, commending the company is well “on-track.”
As usual, we suggest you take any analyst’s notes with a grain of salt. According to TipRanks, one-star analyst Vijay Bhagavath is ranked #3,560 out of 4,110 analysts. Bhagavath has a 47% success rate and faces a loss of 3.3% in his average returns. However, when recommending ACIA, Bhagavath earns 58.5% in average profits on the stock.
TipRanks analytics demonstrate ACACIA as a Strong Buy. Based on 4 analysts polled by TipRanks in the last 3 months, 3 rate a Buy on Acacia, while 1 maintains a Hold. The 12-month price target is $70.75, marking a 12% upside from where the shares last closed.
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Shares of Sunrun are up nearly 13% on Friday, after the company’s second-quarter performance surpassed analyst expectations. Sunrun posted revenue of $122.5 million, topping consensus estimates of $111.2 million, and EPS of $0.31 crushed the $0.51 loss analysts expected.
Reacting was Oppenheimer analyst Colin Rusch, which reiterated an Outperform rating on Sunrun stock, while raising the price target to $9.00 (from $8.00).
Rusch wrote, “As RUN reported deployments and bookings ahead of expectations, we believe the company is benefiting from several structural advantages. First, we view the multichannel approach to deal sourcing, particularly leveraging its distribution business, as critical to its industry-leading NPV/W performance. Second, we believe its history as a finance entity has led to discipline around unit economics ahead of peers which we believe will drive investor returns. Last, but not least, we view its technology-agnostic approach is assisting the company’s ability to raise capital for deployments and back leverage on its portfolio. Notably, we expect the company to begin deploying string inverters with rapid shutdown capability later this year.”
According to TipRanks.com, analyst Colin Rusch has a yearly average return of 8.6% and a 47% success rate. Rusch has an -11.0% average return when recommending RUN, and is ranked #490 out of 4110 analysts.
Out of the 7 analysts polled by TipRanks, 5 rate Sunrun stock a Buy, while 2 rate the stock a Hold. With a return potential of 84%, the stock’s consensus target price stands at $11.43.
Cyclacel Pharmaceuticals Inc
Cyclacel Pharmaceuticals shares rose nearly 15% today, following a favorable report by H.C. Wainwright analyst Andrew Fein. The analyst reiterated a Buy rating on Cyclacel stock, with a price target of $60, which implies an upside of 1075% from current levels.
Fein wrote, “We recognize that the company’s current $13.5M market cap makes Cyclacel not appetizing to a number of investors. That said, it is hard not to comment on what would classically count as an atypically positive risk/reward opportunity ahead of the pending readout of the pivotal SEAMLESS study in elderly AML patients unfit for induction therapy (number of events needed for final analysis reached). In our view, the positive risk/reward has less to do with the odds of success (which have not changed), and more to do with the depressed valuation ahead of the readout.”
“We acknowledge that an outright survival win in SEAMLESS may be a long shot. However, we also know that the surprise element in AML can go both ways. That said, in biotech we are fundamentalists, and generally avoid risk/rewards theses. Then, if we crop AML from the picture and only view valuation fundamentally as a function of the other two clinical programs running, Cyclacel still emerges as attractive,” the analyst continued.
According to TipRanks.com, analyst Andrew Fein has a yearly average return of 15.2% and a 47% success rate. Fein has a -42.8% average return when recommending CYCC, and is ranked #182 out of 4110 analysts.