Groupon Inc (GRPN), Netflix, Inc. (NFLX) and More ‘Market Moving’ Upgrades Worth Noting Last Week

Page 1 of 2

Stocks can be pushed higher or lower as analysts provide their outlooks. These calls are not enough to base an investment on, but should be considered as part of your research. Therefore, I am assessing a few of Thursday’s top calls, and determining if each was a good call.

Groupon Inc (NASDAQ:GRPN)

When it comes to technology, there is one analyst that I take more seriously than the others, and that is Gene Munster. Munster has been incredibly accurate at predicting trends, stock prices, and macro conditions. Therefore, when he says that Groupon Inc (NASDAQ:GRPN) could deliver a Q1 daily deals take rate of 33%, I tend to listen.

Groupon Inc

According to Munster, a 33% take rate would equate to revenue of $607 million, or $17 million better than the consensus for Groupon Inc (NASDAQ:GRPN)’s current quarter. While Munster has been correct in his calls of many tech stocks, we must also admit that he has had some trouble with Groupon Inc (NASDAQ:GRPN). The Piper analyst was quite bullish going into Q4 last quarter, which didn’t turn out so well. As a result, it’s hard to determine if maybe he’s too bullish on the stock or if there really is a fundamental shift occurring. Either way, the stock rallied 5.24% and I haven’t seen enough consistency from the company to call it a “buy.” Therefore, I think I will sit this one out.

Brown Shoe Company, Inc. (NYSE:BWS)

The Brown Shoe Company, Inc. (NYSE:BWS) continues with its strong year, as the stock rallied another 5.19% on Thursday. The large gains came after Brean Capital initiated coverage with a “Buy” rating, saying “it’s a compelling turnaround story.” The firm believes in the company’s strategy of downsizing to become slightly smaller but more profitable.

In the end, the market places a large amount of emphasis on earnings, and Brean Capital believes that the company’s strategy to become more profitable will be rewarded over time. I think this strategy makes sense, if the company is undervalued and if there is room for margin improvement. With Brown Shoe Company, Inc. (NYSE:BWS), there is a lot of room for improvement. The company has revenue of $2.60 billion yet a market cap of just $740 million. Therefore, I am a believer in this company’s future, but I would keep it on a short leash and would expect to see fundamental improvements every quarter, or else I would sell.

Netflix, Inc. (NASDAQ:NFLX)

On Wednesday, shares of Netflix, Inc. (NASDAQ:NFLX) traded lower after a downgrade. But on Thursday, Goldman raised its price target to $184 from $125, although reiterated its “Neutral” rating. Goldman’s call was more long-term, as they believe that the company’s domestic streaming sub base will grow to 53 million in five years, from its current 22.8 million. As a result, Goldman expects this increase in connected users will make the company more profitable and that it will be able to leverage its sub base to grow further.

As an investor, I like the call, I think $184 is fair based on its current price, but I do not favor the reasons. Sure, sub bases are important for the company, but looking ahead, competition continues to grow and I think Netflix, Inc. (NASDAQ:NFLX) is doing a great job in positioning itself for global growth. Therefore, I do think Netflix, Inc. (NASDAQ:NFLX) is a compelling story and I think expectations have been adjusted to its new business model and that shares will rise over time.

As an investor, I like the call, I think $184 is fair based on its current price, but I do not favor the reasons. Sure, sub bases are important for the company, but looking ahead, competition continues to grow and I think Netflix, Inc. (NASDAQ:NFLX) is doing a great job in positioning itself for global growth. Therefore, I do think Netflix, Inc. (NASDAQ:NFLX) is a compelling story and I think expectations have been adjusted to its new business model and that shares will rise over time.

Conclusion

Page 1 of 2
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

The Top 10 Most Expensive Digital Cameras to Snap Stunning Shots With

The 10 Highest Quality Fast Food Restaurants In America Today

The 8 Best Halloween Decorating Ideas to Spook Up Your House

10 Marvel Women that Should Get a Movie Right Now

The 20 Best Remixes of Popular Songs that Will Make You Forget the Originals

7 Most Expensive Cities in the World

5 Least Expensive Cities in the World

10 Celebrities Who Believe In Scientology

10 High Margin Food Products to Build a Business Around

The 10 Most Expensive Clothing Stores in the United States to Get Decked Out At

The 5 Biggest Kickstarter Scams That Swindled Backers’ Donations

The 10 Most Expensive Boarding Schools In the World

50 Crazy Facts About Japan You Won’t Believe

Top 10 Least Expensive Hybrid Cars to Save the Planet With

The 10 Biggest ‘Gate’ Controversies in History

The 10 States with the Highest Nursing Shortages Leaving Their Hospitals Depleted

The 10 Best Value Investment Blogs that Every Investor Must Read

The 6 Cheapest Boarding Schools in Europe 2015

The 5 Most Expensive Cars To Insure in the World

The 10 Most Common Genetically Modified Foods

10 Self-Made Billionaires Who Came From Nothing

The 10 Most Expensive Cities to Live in North America

The 13 Most Expensive Headphones in the World to Represent

The Top 20 Wealthiest Soccer Teams in 2014

4 BuzzWorthy Cannabis Stocks And Some Smoking Derivative Plays

The 10 Healthiest Fast Food Chains in America to Dine At

The 5 Most Expensive Cat Food Brands You Can Spoil Your Kitty With

The 6 Best eCommerce Platforms for Small Businesses

The 10 Worst Mistakes an Entrepreneur Can Make

The 5 Most OP Characters in League of Legends to Carry Games and Crush Foes With

The 5 Best Foods to Eat Before Running that Will Help You Pound the Pavement

10 Glaring Plot Holes in The Walking Dead that a Zombie-Filled Bus Could Drive Through

The 5 Biggest Celebrity Stoners Who Love Their Reefer

The 10 Most Overrated Movies Of All Time by Out-of-Touch Critics

Top 6 Least Expensive Cruise Destinations For 2015 that Will Take You to Paradise

10 States with Lowest Substance Abuse Rates in America

The 14 Most Watched TV Finales Ever

The 10 Best Selling Role Playing Games of All Time for PC

10 Most Influential Papers In Economics

Top 8 Biggest Charities in the US

10 Worst Celebrity Career Moves Ever

Top 10 Best Paid Tennis Stars in the World

Top 6 Cities For The Ultra Rich to Live in Comfort

10 Cities with High Demand for Nurses

6 of the Worst Greeting Card Messages Ever Crafted

How to Make Money in ArcheAge and Build Your Empire

10 Foods To Eat To Lower Cholesterol Levels

The 10 Most Hated Television Characters of All Time

The 30 Worst Halloween Costume Ideas Ever Brought to Horrible Life

10 Vocational Skills in Demand Today with Jobs Waiting to be Filled

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!