These reports, excerpted and edited by Barron’s, were issued recently by investment and research firms. The reports are a sampling of analysts’ thinking; they should not be considered the views or recommendations of Barron’s. Some of the reports’ issuers have provided, or hope to provide, investment-banking or other services to the companies being analyzed.
Buy • Price $213.69 on June 12
by Goldman Sachs
We reiterate our Buy rating and $325 price target, as Salesforce’s AI Day provided color on the company’s generative-AI tech stack, market strategy, and monetization plans after a slew of product announcements over the past few months.
Salesforce’s approach is likely to set the industry standard going forward, given that: 1) it’s not reliant on any one foundation model, 2) it will gather relevant information from a variety of data sources to drive personalized and accurate prompts/outputs, and 3) it offers an enterprise-grade solution for data governance.
Combining AI, data, and Salesforce capabilities, the company is uniquely positioned to execute on this strategy.
Buy • Price $116.43 on June 13
Oracle reported strong fiscal fourth-quarter results ahead of consensus. We believe investors continue to underestimate Oracle’s potential over the medium term to generate solid top-line and cash-flow growth, and exceed its fiscal 2026 targets. Strong fiscal-fourth-quarter results with upside potential from solid AI momentum should improve investor sentiment and drive upside to fiscal-2026 estimates. We reiterate our Buy rating and raise our price target to $150 from $116.
Buy • Price $157.09 on June 14
We recently hosted CFO Pierre Breber and General Manager, Investor Relations Jake Spiering for investor meetings. A key strength of Chevron is its balance sheet that’s at 4% net debt/capital with $15.7 billion of cash on hand. While only $5 billion of cash is needed to run operations, we see Chevron maintaining a higher balance in the current uncertain economic environment.
However, cash will be deployed over time, including to support shareholder returns, should Brent crude oil fall to $50 a barrel. Chevron stressed the importance of dividend growth, and we’re modeling in 6% annual growth through 2027, but we see upside at $75-plus Brent. We view the $7.6 billion PDCE Energy acquisition as positive, with the transaction accretive to free cash flow per share and the return of capital profile. There’s also minimal integration risk. Target price: $212.
Buy • Price $423.97 on June 13
We continue to see underappreciated opportunity in Netflix shares over the next 12 months, even after year-to-date outperformance. We believe that the company’s position as the global leader in high-quality, long-form streaming video will drive further financial upside through higher subscription average revenue per user, advertising revenue, and margin expansion. Our review of Apptopia download data supports broader feedback that the recently expanded paid-sharing initiative is not driving a sustained increase in member churn.
We raise our price target to $500 from $375.
Outperform • Price $23.09 on June 14
by TD Cowen
We upgrade shares of Kohl’s to Outperform, as we expect new home-decor and gifting products, improved fashion execution, a simplified promotional strategy, and pragmatic store layout revisions to drive healthier and more consistent traffic and faster inventory turns. Valuation is attractive at five times enterprise value/Ebitda, with an 8% dividend yield.
We believe the new CEO, Tom Kingsbury, has practical retail ideas that are well positioned to work after many years of insufficient change. Our take is that Kingsbury has a practical merchant background and is leveraging this experience to drive positive change.
We also believe he is making pragmatic edits to the store, such as deleting unused registers, adding gifting tables in attractive parts of the store, and moving to a more modern markdown cadence.
We believe these plans are supported by an encouraging foundation for younger customers, given the new Sephora shop-in-shops, which are outperforming the rest of the business. Price target: $30.
Floor & Decor Holdings
Buy • Price $94.87 on June 15
Checks indicate that Floor & Decor’s in-home pilot has ramped over the past few years, as Texas and Florida homeowners have found value in the convenience of a designer-led consultation in their residence. Access to customer homes is a rarity in retail. Floor & Decor’s in-home pilot launched in early 2020, and our checks indicate that it has expanded to 15% of the store base. Customers are tiered depending on project size and pay a fee of $199 (one-to-two rooms), $399 (more than two rooms), or $599 (more than 5,000 square feet) for in-home visits. Floor & Decor’s in-store conversion is already industry-leading at about 81%, with levels higher when design associates are involved. Theoretically, in-home experiences should drive conversion even higher.
Thinking longer term, we’re intrigued with the data that Floor & Decor’s design associates may be able to gather and potential for proactive outreach. Price target: $110.
To be considered for this section, material should be sent to Research@barrons.com.
#Netflix #Stock #Hit