Recent analyst actions include Bay Area Ideas upgrading Zscaler (ZS) to Hold, citing improving AI monetization and a more reasonable valuation. Meanwhile, Dhierin Bechai has upgraded Lam Research (LRCX) to Buy, driven by robust wafer fabrication equipment demand and memory supply bottlenecks. On the downside, Brett Ashcroft Green maintains a Hold rating on NXP Semiconductors (NXPI), noting that 2026 growth appears already priced in. Dhierin Bechai has also downgraded Rocket Lab (RKLB) to Sell, warning that Neutron rocket euphoria has pushed the stock far ahead of its fundamentals.
Upgrades
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Zscaler (ZS): Upgrade Sell to Hold by Bay Area Ideas. The analyst cites Q1 results showing AI innovation translating into financial growth, combined with a more reasonable valuation following a 27% stock decline since the previous downgrade.
“Q1 results indicate that AI innovation is now starting to translate into financial growth. FY2026 guidance is mixed, but still, there are signs the long-term trajectory of the business is improving. … While the valuation still isn’t cheap, I would say that the forward P/E now offers a much fairer reflection of where the fundamentals are at.”
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Lam Research (LRCX): Upgrade Hold to Buy by Dhierin Bechai. The analyst points to revised wafer fab spending forecasts calling for 10–15% YoY growth, supporting higher sales and margin expansion for the semiconductor equipment maker.
“I am currently applying a valuation that prices the stock at three times the median given strength in wafer fabrication equipment demand. As a result, I am rating the stock a buy with a $246.84 base case price target, indicating 13% upside and 33% upside in a more bullish setting with a $291.11 price target.”
Downgrades
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NXP Semiconductors (NXPI): Hold maintained by Brett Ashcroft Green. Despite healthy 2026 earnings growth expectations, the analyst believes current pricing leaves limited margin of safety, with automotive semiconductor commoditization remaining a key risk.
“Without providing new and interesting integrations, I feel the automotive and handset IoT segment of semiconductors risks becoming more and more commoditized. … On the positive side, 2026 looks to be a healthy growth year ahead. That growth, in my opinion, is already priced in where the stock sits unless there is an automotive semiconductor multiple re-rate.”
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Rocket Lab (RKLB): Downgrade Buy to Sell by Dhierin Bechai. The analyst warns that excessive valuation driven by Neutron rocket euphoria is disconnected from near-term financial prospects, with sales-based valuation methods indicating 20–38% downside risk.
“While I do believe that Rocket Lab could continue seeing higher share price on extremely bullish sentiment, I do believe that the current share prices are unhealthy, as there is no reasonable foundation for the current stock prices when looking at the expected financial performance in the years ahead. … The share price has been a nice way for investors to make money, but in that process the touch with the fundamentals has completely vanished.”