Palantir Downgraded and Micron PT Upgraded Before Earnings According to Investing.com

Investing.com – Here are the biggest moves by analysts in artificial intelligence (AI) this week.

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Microsoft is “the best way to bring AI into our reach,” Truist says

Microsoft (NASDAQ:) remains “the best AI leverage within our reach,” Truist Securities analysts said in a note published this week.

“We believe that many of the key themes that drive Microsoft’s business are indicative of major trends in both our infrastructure and security landscape,” the company says.

“In particular, we see the company’s evolving artificial intelligence strategy positioning the company as a leader in the software industry.”

While there will ultimately be many winners in the generative AI model space, OpenAI is the clear leader in the LLM space, analysts say.

They argue that the first-mover advantage for enterprise AI applications will continue due to the intense attention paid to architectural and management decisions.

Analysts continue to believe that the partnership between Microsoft and OpenAI will bring additional benefits to MSFT compared to other cloud service providers.

Palantir downgraded to Sell on Monnes, Crespi and Hardt

Analysts Monness, Crespi and Hardt downgraded their ratings Palantir Technologies Inc (NYSE:) upgraded from Neutral to Sell, setting a price target of $20.

PLTR shares fell almost 5% after the market opened on Friday.

The decision follows a disappointing earnings season for enterprise software and the failure of an 18-month generative AI hype cycle that failed to generate significant revenue for most industry players. Analysts noted that the market will likely steer clear of software stocks with inflated valuations.

“After rising 167% in 2023, Palantir shares were already rich in early 2024, and with a 49% year-to-date gain, we believe valuation has now reached a voracious extreme,” they wrote.

While Monnes believes Palantir remains well-positioned to benefit from the AI ​​trend and volatile geopolitics in the long term, the company notes that the stock’s current valuation has reached extreme levels.

Combined with pressure from the software industry and erratic revenues from government contracts, “the darkest days of this economic quagmire lie ahead,” analysts say.

Bernstein raises AAPL price target: Apple ‘can be a leader in artificial intelligence, not a laggard’

Investment firm Bernstein raised its price target on Apple Inc (NASDAQ:), expressing confidence that investors now see the iPhone maker “can be a leader in artificial intelligence, not a laggard.”

Raised the 12-month price target from $195 to $240, suggesting an upside of almost 15% from current levels.

Bernstein analysts noted that Apple has more than 1 billion customers compared to ChatGPT’s 100 million, which means there is significant potential for Apple to bring AI to a wide audience, improving everyday usability. Interestingly, Apple does not pay for ChatGPT, “emphasizing the power it holds.”

Bernstein also said investors are increasingly optimistic about the upcoming iPhone 16, expecting a solid product cycle, in part because AI features will only be available on iPhone 15 Pro and higher models.

“While we are increasingly confident that Apple will be a beneficiary of artificial intelligence, we see a risk that the benefits may materialize later than some bulls think,” analysts warn.

“Many Apple Intelligence features will be introduced next year and will only work in English, potentially forcing some updates into the iPhone 17 cycle,” they added.

Wedbush raises Micron PT to $170 ahead of earnings release

Earlier this week, Wedbush Securities analysts maintained a Buy rating on memory chipmaker Micron Technology Inc (NASDAQ:) and increased their price target from $130 to $170 ahead of the company’s earnings report next week.

“In our view, the fundamental issue with MU is that history suggests the stock is expensive relative to asset levels,” the company’s analysts noted.

Analysts acknowledge that while memory remains a cyclical industry, its supply will remain steady this year and likely through much of 2025. This is due to a lack of new investment in NAND and DDR5 memory, partly driven by increased capacity requirements for high-bandwidth memory (HBM).

“Accordingly, we believe that average selling prices (ASP), revenues, margins and EPS will trend upward and accounting will also increase with the inflow of FCF to MU’s balance sheet,” they noted.

“Net, we expect nothing but positive news for MU’s financials for some time to come and we expect the stock to continue rising until we see a change in the industry’s investment plans.”

Rosenblatt: Adeia is “the most underrated AI game on the market”

Rosenblatt Securities said that intellectual property (IP) licensing company Adeia Inc (NASDAQ:) is “the most underrated AI play in the market,” maintaining a Buy rating on its stock.

Following discussions with CEO, CFO and Vice President of Investor Relations, Adeia Rosenblatt highlighted the company’s “under-the-radar” status despite its leading position in key sectors of AI development.

The company’s analysts highlighted the significant opportunities that lie in semiconductors, noting that the limitations of transistors are causing the end of Moore’s Law. “Adeia’s hybrid interconnecting and chiplet IP offer a solution” to these challenges, they noted.

In the media sector, Rosenblatt recognized Adeia as a “leader in digital entertainment intellectual property,” which positioned it well as video continues to grow across devices.

On the financial front, Rosenblatt praised Adeia’s “over 60% operating margin” and its valuation.

“We see Adeia as the most underrated AI game on the market,” they emphasized. “We recommend investors take a deeper look at the company.”