Big Moves | Meta, Apple, and Tesla's target prices have been raised! Why did Tencent face a "price cut"?

CICC: Maintains "Buy" Rating on TENCENT, Lowers Target Price by 11% to HKD 399

Based on the latest closing price of HKD 332.8, this price implies a 20% upside potential!

The bank expects TENCENT's second-quarter total revenue to be CNY 153 billion, a YoY growth of 14%, in line with market expectations. Among them, the revenue from games/value-added services/advertising/financial technology and cloud is expected to grow by 9%/9%/24%/19% YoY, respectively. The adjusted operating profit is estimated to be CNY 45.1 billion, a YoY growth of 23%, with an operating profit margin of 29.5%. The estimated adjusted net profit and net profit margin are CNY 35.3 billion and 23%, respectively, while the market expectation is CNY 36.6 billion and 24%.

Due to seasonal factors, the bank expects the second-quarter game revenue of TENCENT to grow by 9% YoY, slightly lower than the previous expectation of 10%. Overseas games are the main driving force behind the revenue growth. The new games "Fearless Contract" and "Arknights" were launched on July 12th and 20th, respectively, which may drive the game revenue in the third quarter. Considering that there are no new game releases scheduled yet, the game valuation is adjusted down to the industry average, giving TENCENT a forecasted P/E ratio of 20 for its profitable business.

Credit Suisse: Maintains "Neutral" Rating on Sunny Optical, Lowers Target Price by 17% to HKD 84

Based on the latest closing price of HKD 67.35, this price implies a 25% upside potential!

The bank expects the revenue of smartphone products in the first half of the year to decline due to the weakness in the first quarter. Although it believes that shipments will improve in the second half of the year due to seasonal factors, the operating margin will be under pressure due to aggressive pricing, and the average selling price of automotive products may also decrease due to intensified competition.

The bank pointed out that due to weak demand for smartphones, it has revised its previous forecast. The latest forecast predicts that Sunny Optical's smartphone camera module shipments in 2023 will remain flat YoY, while smartphone lens shipments may increase by 1%, compared to the previous forecast of 4% growth for both. The forecast for automotive products has been raised from a 15% YoY increase to a 25% increase, reflecting strong demand for electric vehicles. At the same time, the bank has lowered the company's earnings per share forecast for 2023 to 2024 by 30%/22.7% to CNY 2.03/2.84, respectively, to reflect the slow recovery in smartphone demand and margin pressure.

Credit Suisse: Raises Apple's Target Price by 10% to USD 220

Based on the latest closing price of USD 195.1, this price implies a 3% upside potential!

Piper Sandler: Raises Tesla's Target Price by 7% to USD 300

If calculated at the latest closing price of $291.26, this price implies a 3% upside potential!

Jefferies: Raises Meta's target price by 28.5% to $360

If calculated at the latest closing price of $316.01, this price implies a 14% upside potential!

The bank expects Meta's revenue in the second quarter to exceed expectations, and revenue guidance for the third quarter may accelerate in a more relaxed competitive environment. The bank believes that with the combined effect of a relaxed market competition, increased engagement from AI investments, and improving return on investment for advertisers, Meta will accelerate revenue growth and improve efficiency in 2023.

Wolfe Research: Initiates AMD with an "outperform" rating and a target price of $150

If calculated at the latest closing price of $116.43, this price implies a 29% upside potential!

The bank points out that AMD's customer computing and data center inventories are returning to normal, which will help AMD achieve growth in the second half of this year.