The company is well-placed to benefit from pervasive trends in PC gaming, increased penetration in the automobile market and an improving product mix, but with no long-term financial model in place, the broker feels the valuation is beginning to feel stretched “and we will need big beats and raises to get further [earnings] multiple expansion.
Nevertheless, after attending the company's annual analyst day it has upped its price target from $34 to $38.
Royal Bank of Canada has been pontificating on what the spate of executive departures at computer chip giant Intel Corporation (NASDAQ:INTC) means for the company known in computing circles as Chipzilla.
A successor has not yet been named for Doug Davis, of the Internet of Things division, who expects to retire at the end of this year after 32-years with the company, while Kirk Skaugen (Cloud Computing Group) has moved on to bluer skies, bringing the number of top-level executives who are leaving, or who have left Intel in the last year up to five.
“We find the multitude of changes somewhat concerning as it runs the potential of INTC perhaps going through a round of restructuring as new division heads have a different perspective. Finally, the departure of the Communication and Devices Group head (Aicha Evans) is rather odd specially given recent media discussions that INTC has finally landed allocation with AAPL,” the bank said, as it stuck with its 'sector perform' rating and $33 price target.
Debt ratings agency Standard & Poor's has left the drugs giant's rating on CreditWatch with negative implications – AA/Watch Neg/A-1+ in S&P's gobbledygook ratings system – even though Pfizer is set to incur a break fee of $400mln, and indicated it would probably remove the debt from CreditWatch now the deal has fallen through.
Dundee Capital Markets has reiterated its high-risk 'buy' rating for Denison Mines Corp (TSE:DML, NYSEMKT:DNN) after the miner's publication of the preliminary economic assessment (PEA) on its 60%-owned Wheeler River uranium oxide (U308) project.
“The PEA's upper price scenario values Wheeler at C$913 MM (C$548 MM DML share) using $62.60/lb U3O8, beating Dundee and Street,” the broker noted.
The mine will be a while in development so an assumed price of $62.60 a pound rather than the current price of circa $44 a pound is a reasonable one, in Dundee's view.
Even so, Denison's management stressed that Wheeler can be developed in the current uranium price climate.
“Denison’s excitement and resolve can be felt from the press release; it has a plan and its production experience provides understanding of what’s required: the project isn’t expensive to build; it generates a commercial IRR [internal rate of return] at today’s prices; infrastructure is already in place and provides a competitive advantage,” Dundee noted.
“Ultimately, this robust study signals Wheeler's potential to be one of the next producing uranium mines in the Athabasca. It should also help investors value the stock, as we suspect many don't realize Wheeler's worth. A PFS [pre-feasibility study] is to start immediately and to run parallel to permitting,” the broker added.
Dundee's price target is a punchy C$2,10, triple the current share price. Meanwhile, Paradigm Capital reacted to the release of the PEA by nudging up its price target from C$1.40 to C$1.50 on Tuesday.
Aveda Transportation and Energy Svcs Inc (CVE:AVE) recently reported fourth quarter and full-year results that missed Mackie Research's revenue estimate and were just below its underlying earnings (EBITDA) loss and loss per share estimates.
The significant slow-down in drilling activities in the oil and gas sector continues to have an effect on Aveda’s financial results, and although the company says competitors are exiting the market, holding out the hope that pricing might have bottomed out, 2016 is clearly still going to be a challenging one for the transportation services provider.
“Based on the current cash availability on its senior debt facility, we believe Aveda has the financial capacity to meet its obligations and manage through the downturn,” the broker said, as it cut its top-line and margin expectations.
The 'buy' rating is returned, as Mackie feels Aveda is an undervalued pure play on oilfield transportation, with scalable operations and a flexible balance sheet.