Pivotal Forecasts Good Year For Online Ads, Upgrades Adobe, Alphabet, Salesforce

Tech stocks have been on a wild ride since third-quarter earnings season kicked off, and one Wall Street analyst adjusted ratings on several big-name tech stocks Monday ahead of Q4 earnings.

The Analyst

Pivotal Research Group analyst Brian Wieser made the following rating and price target changes: 

• Adobe Inc ADBE upgraded from Hold to Buy, price target raised from $252 to $262.
• Alphabet Inc GOOG GOOGL upgraded from Hold to Buy, price target raised from $1,010 to $1,240.
• Amazon.com, Inc. AMZN initiated with a Buy, $1,920 price target. 
• Criteo SA CRTO reiterated at Buy, price target raised from $38 to $42.
• Facebook, Inc. FB reiterated at Sell, price target lowered from $125 to $113.
• Salesforce.com, Inc. CRM upgraded from Hold to Buy, price target raised from $140 to $164.
• Snap Inc. SNAP downgraded from Buy to Hold, price target lowered from $8 to $6.
• Trade Desk Inc TTD reiterated at Sell, price target raised from $55 to $69.
• Twitter, Inc. TWTR reiterated at Hold, price target raised from $28 to $30.

The Thesis

This year will be another good one for online advertising and marketing companies despite concerns over a potential economic downturn, Wieser said in the note. (See his track record here.) 

“We think that marketing technology companies (ADBE and CRM in particular) would hold up best in a downturn given the predictable revenue streams and bookings made well in advance (as well as secular trends supporting marketing tech which has a very long runway, in our view),” the analyst said. 

Amazon’s AWS business is also relatively immune to a downturn for the same reasons, but its e-commerce business likely is not,he said. 

Finally, Wieser said the trade war with China shouldn’t have a major impact on most of the stocks mentioned, although Facebook’s advertising business does have some Chinese exposure. Amazon also has many marketplace users with exposure to China as well, he said. 

Price Action

Here’s how the stocks mentioned were trading at the time of publication: 

• Twitter was up 4.11 percent. 
• Trade Desk was up 5.75 percent. 
• Snap was up 3.11 percent. 
• Salesforce was up 3.49 percent. 
• Facebook was up 0.2 percent. 
• Criteo was down 0.34 percent. 
• Alphabet was down 0.37 percent. 
• Adobe was up 2.04 percent. 
• Amazon was 3.03 percent higher. 

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