There’s a lot to be optimistic about in the Consumer Goods sector as 3 analysts just weighed in on Callaway Golf (NYSE:ELY), Cohu (NASDAQ:COHU) and Acacia Communications (NASDAQ:ACIA) with bullish sentiments.
Callaway Golf (ELY)
In a report released yesterday, Susan Anderson from B.Riley FBR reiterated a Buy rating on Callaway Golf, with a price target of $24. The company’s shares opened today at $21.63.
Anderson commented:
“Callaway Golf (ELY) reported 2Q18 adjusted EPS of $0.63, vs. B. $0.47, reflecting solid +30% sales growth (vs. B. +21.2%/+21.9%). GM de- leveraged –10 bps (B. +180 bps/+28 bps), while op. margin leveraged of +191 bps (B. +50 bps/+33 bps). ELY provided increased 2018 guidance from 12%–13% top-line growth to 15%–17%, driving $0.95–$1.00 (previously $0.77– $0.82). 1H results benefited from the enormous success of the Rogue woods/irons, as well as the Chrome Soft golf balls. Due to timing of these large launches and the development cycle of new products, 2H will have comparatively less new product launch activity.”
According to TipRanks.com, Anderson is a 4-star analyst with an average return of 6.1% and a 55.4% success rate. Anderson covers the Services sector, focusing on stocks such as Lululemon Athletica Inc, Ascena Retail Group, and Abercrombie Fitch.
Currently, the analyst consensus on Callaway Golf is a Strong Buy with an average price target of $24.40, representing a 12.8% upside. In a report released today, Jefferies also reiterated a Buy rating on the stock with a $25 price target.
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Cohu (COHU)
In a report released today, Craig Ellis from B.Riley FBR maintained a Buy rating on Cohu, with a price target of $32. The company’s shares opened today at $26.03, close to its 52-week high of $26.66.
Ellis observed:
“Thursday AMC (8/2), back-end handler and contactor specialist Cohu, Inc. (COHU) exceeded Street and our 2Q estimates, guided 3Q lower directionally as we previewed, but also signaled expectations for +8.0% CY18 Y/Y revenue growth implying a +2.0% Q/Q 4Q rebound. So, while not calling a 3Q bottom per se, the quarterly progression reflects that profile. In our view, positives included strong 2Q equipment and recurring sales, a 90 bps GM upside surprise, signs of rigorous operating expense control, and the multi-quarter sales outlook signaling brief smartphone-induced lull against the backdrop of continued strong auto and industrial power management demand. More broadly, management re-confirmed an early-4Q18 XCRA close, which we expect to be a significant positive EPS revision catalyst when SS estimates update.”
According to TipRanks.com, Ellis is a top 25 analyst with an average return of 36.0% and a 77.5% success rate. Ellis covers the Consumer Goods sector, focusing on stocks such as Sequans Communications S A, Axcelis Technologies, and Silicon Laboratories.
Currently, the analyst consensus on Cohu is a Moderate Buy with an average price target of $30.50.
Acacia Communications (ACIA)
In a report released today, Dave Kang from B.Riley FBR reiterated a Buy rating on Acacia Communications, with a price target of $45. The company’s shares opened today at $38.30.
Kang commented:
“The main takeaways from Acacia Communications’ (ACIA) strong 3Q outlook were: (1) New products, notably the CFP2 DCO (Digital Coherent Optics), are ramping faster than expected, and (2) the return of ZTE (763-HKG), which will provide significant incremental growth. This momentum is expected to persist through 2H and beyond. While customer concentration was an issue for the company in the past, ACIA was able to replace ZTE with another 10% Chinese customer (which we believe is Huawei) during 2Q. A major switch & router customer is expected to join the 10% customer list in 2H18.”
According to TipRanks.com, Kang is a 5-star analyst with an average return of 16.9% and a 59.0% success rate. Kang covers the Consumer Goods sector, focusing on stocks such as Lumentum Holdings, NeoPhotonics, and Emcore Corp.
Currently, the analyst consensus on Acacia Communications is a Moderate Buy with an average price target of $39.85, representing a 4.0% upside. In a report issued on July 31, William Blair also maintained a Buy rating on the stock.
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