Tesla Inc (TSLA) to Put Pedal to Medal on Model 3, Micron Technology, Inc. (MU) Cost-Competitive in New Nand World


Tesla Is a Top Pick for 2017

Tesla Inc (NASDAQ:TSLA) boasts a long-term highway of prospects ahead, says Baird analyst Ben Kallo who anticipates such soaring Model 3 demand that most are likely selling it short. This will be music to CEO Elon Musk’s ears, who has triumphed in a year that has seen his electric car giant outclass the market time and time again.

The analyst reiterates an Overweight rating on shares of TSLA while hiking the price target from $368 to $411, which represents a just under 13% increase from where the stock is currently trading.

Kallo predicts, “We expect strong demand for the Model 3 and believe the total addressable market will likely be underestimated, but think it will be an ongoing process to ascertain global demand,”

Therefore, the analyst has gotten extra bullish on this giant, asserting, “Tesla remains one of our top picks for 2017 and we are raising our price target as we continue to believe a successful Model 3 launch will be an inflection point for the stock.”

Domestically and worldwide, the Model 3 stands to reap in profits for Tesla, says Kallo, who adds, “We think the large US market will support sales of the Model 3, and significant additional opportunities exist internationally,”

With Musk “confident” that his electric car giant will be able to produce 10,000 Model 3 vehicles per week by some time next year, it has become clear to Kallo that investors need to not blink or they’ll miss the stock’s compelling opportunity. “We continue to believe Tesla Energy may be underappreciated by investors, and think the segment could be as important as the auto business over the long term,” surmises the analyst.

TipRanks analytics showcase TSLA as a Hold. Out of 17 analysts polled by TipRanks in the last 3 months, 5 are bullish on Tesla stock, 7 remain sidelined, and 5 are bearish on the stock. With a loss potential of 14%, the stock’s consensus target price stands at $311.92.

Micron Stands as a Victor of Flash Memory Trend Evolution

Micron Technology, Inc. (NASDAQ:MU) shares are rising almost 4% today after receiving a bullish show of hands from Stifel analyst Kevin Cassidy who finds flash memory trends beneficial to this chip giant.

Following attending the Flash Memory Summit conference last week in Santa Clara, the analyst finds that memory chips are quickly taking the lead as the crux of server computers- move over, microprocessors.

Cassidy points to solid-state NAND memory chips coupled with “non-volatile” memory parts “increasing the importance of memory to overall system performance,” which further reveals the evolution of data centers kickstarting a “transition from CPU-centric systems to data-centric systems.” This translates to an encouraging unfolding for Micron, and a bad progression for competitors like AMD and Intel.

As such, the analyst reiterates a Buy rating on the stock with a price target of $60, which implies a roughly 107% increase from current levels.

“We believe Micron has greatly improved its Flash cost structure, and expect the company’s costs will continue to decrease moving forward. The company reiterated that it has the smallest 3D NAND die size in the industry, which allows its current products to be more competitive in terms of cost, as opposed to its competitive positioning in planar NAND where the company had higher costs than the industry average, and therefore lower gross margins. Micron’s smaller 3D NAND die size is the result of its Floating Gate architecture, which was also the standard for planar NAND, as opposed to Charge Trap Layer architecture used by Samsung, Toshiba, and SK Hynix,” underscores Kassidy.

TipRanks analytics reveal MU as a Strong Buy. Based on 19 analysts polled by TipRanks in the last 3 months, 16 rate a Buy on Micron stock, 2 maintain a Hold, while 1 issues a Sell. The 12-month average price target stands at $41.43, marking a nearly 43% upside from where the stock is currently trading.

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