AMD Upgrade
Raymond James upgraded Advanced Micro Devices (AMD) to Strong Buy from Outperform, extending its AI Factory framework to the server CPU market. The broker forecasts the server CPU market to expand at a 44% compound annual growth rate, reaching roughly $201 billion by 2030, split into $33.5 billion of conventional datacenter CPUs, $83 billion of AI head‑end CPUs and $85 billion of agentic CPUs. Analyst Simon Leopold highlighted agentic AI as the next growth engine and noted that AMD’s own estimate of a $220 billion market under a more aggressive adoption scenario exceeds Nvidia’s $200 billion long‑term framework. He cautioned that shipment growth will not be one‑for‑one with workload growth because of higher utilization, software efficiency, custom silicon and off‑load effects.
SAP Downgrade
UBS downgraded SAP SE to Neutral from Buy and raised its price target to €201 from €164. The downgrade cited slow delivery of agentic AI – SAP has shipped only 17 out‑of‑the‑box AI agents with a further 15 in ramp‑up, far short of its ambition to have 200 agents by year‑end (it delivered 10 agents against a goal of more than 40 last year). UBS projected cloud‑backlog organic growth (CCB) at 24.6% for Q2, marginally above 24.2% at end‑2025, but SAP continues to guide to a “slight” slowdown to around 23% for the full year. Cloud gross margins before stock‑based compensation fell for the first time since 2021, and higher AI token costs pressured R&D expenses. SAP’s fiscal 2026 EBIT guidance was trimmed by €100 million due to expected acquisition dilution. The bank also indicated that SAP is unlikely to meet its “Rule of Forty” target this decade, projecting a 37.0% combined revenue‑margin ratio by 2030 versus a consensus of 36.5%. Management flagged IT‑spending risks linked to the Gulf conflict, a risk that may re‑emerge as CCB growth slows in the second half.
Intuit Downgrade
JPMorgan and Bank of America both downgraded Intuit Inc to Neutral. Intuit forecast fiscal 2027 revenue of $23.28‑$23.51 billion, implying 9‑10% growth, down from 14% growth in fiscal 2026 and below the consensus estimate of $23.72 billion. The slowdown was attributed to weaker Mailchimp sales, continued desktop product declines, and a lower average revenue per TurboTax customer. Fourth‑quarter revenue rose 13.6% to $4.35 billion, beating estimates of $4.27 billion, but the stock fell sharply in pre‑market trading on the guidance miss. JPMorgan’s Samik Chatterjee cut the December 2027 price target to $331 from $605, citing expanding disruption risk to the QuickBooks‑focused Global Business Solutions segment and slowing new‑customer additions across both TurboTax and QuickBooks. Bank of America’s Tal Liani reduced his price target to $360 from $400, noting TurboTax is losing share to lower‑cost AI‑based alternatives and that enterprise‑segment online customer count grew only 3% year‑over‑year. Both banks expect fiscal 2027 to involve heavier investment, with lower pricing, promotional offers and distribution expansion that could pressure margins before delivering meaningful growth.
ASML Reiteration
Bank of America reiterated its Buy rating on ASML Holding NV and set a price objective of €2,452. The stock trades at a 7.7‑times discount to its historical EV/EBIT multiple (20.3× CY27 estimated earnings versus a median of 28.0×) and at a 1.6‑times discount to global peers (U.S. peers trade at a 6.1‑7.0× premium to their own historical averages). BofA expects ASML to post the second‑highest revenue growth among large‑cap semiconductor peers, with a 27% CAGR versus a 22% sector average, and the strongest earnings growth at 39% versus a 33% average. Gross margin is projected to expand by 4.6 percentage points over the next three years, driven by a richer product mix, higher software attach rates and pricing benefits. Even assuming 2026 wafer‑fab equipment spending reaches $160 billion, ASML’s 41% equipment‑sales growth implies lithography intensity of roughly 26%, up from 24.6% in 2025, as accelerating EUV adoption in DRAM and higher layer counts offset weaker China demand and limited advanced‑packaging exposure.
Semtech Upgrade
Northland Capital Markets upgraded Semtech Corp (SMTC) to Outperform with a $182 price target. The firm argues that connectivity is the current AI bottleneck, benefiting Semtech’s copper and optical connectivity offerings. Data‑center revenue now represents 30% of total sales and is expected to rise to 44% by end‑2027, pushing gross margin into the mid‑60% range alongside the LoRa business and the divestiture of the cellular‑module segment. In the second quarter, Semtech reported adjusted EPS of $0.71 on revenue of $342 million, beating consensus estimates of $0.61 and $328 million. Infrastructure sales grew 25% sequentially and 69% year‑over‑year to $124 million, while data‑center revenue hit a record $100 million – up 91% from a year earlier – driven by 800G, 1.6T CopperEdge and the early ramp of 1.6T FiberEdge. Northland expects FiberEdge to capture more than 50% of the data‑center connectivity market by fiscal 2027.