Recent Seeking Alpha analyst actions include Vertiv Holdings (VRT) getting upgraded to Buy on robust AI data center demand, while Starbucks (SBUX) was moved to Neutral following its strategic China divestiture. Meanwhile, Abercrombie & Fitch (ANF) was downgraded to Hold after a rapid rally stretched valuations, and Dell Technologies (DELL) faces a Sell rating amid margin pressure from surging memory prices.
Upgrades
-
Vertiv Holdings (VRT): Upgrade to Buy by JR Research. The analyst highlights Vertiv’s strategic positioning in power and thermal management for AI data centers, including its focus on liquid cooling and collaboration with Caterpillar for on-site power generation.
“The “cool” thing about Vertiv’s roadmap is that it isn’t just indexed against Nvidia’s gargantuan market share, but the broader data center landscape. The fact is that these AI data centers require an increasingly convoluted setup that play into the strengths of full stack companies like Vertiv, allowing them to quickly leverage on their expertise and capture revenue growth opportunities.”
-
Starbucks (SBUX): Upgrade Sell to Neutral by Gary Alexander. The analyst cites Starbucks’ sale of 60% of its China business for $4 billion and signs of stabilizing U.S. comparable sales as reasons for a more positive outlook.
“In my view, it’s a great move for Starbucks to relieve itself of a majority of this division at a relatively lofty price. It’s becoming clearer that Starbucks is facing stiffer competition from the likes of Luckin Coffee. … This $4 billion infusion of cash from the China sale gives Starbucks plenty of firepower to begin building out its store portfolio in the U.S. again.”
Downgrades
-
Abercrombie & Fitch (ANF): Downgrade Buy to Hold by Juxtaposed Ideas. Despite encouraging signs of bottoming comparable sales headwinds and resilient margins, the analyst believes the stock’s near-vertical rally has pulled forward upside potential prematurely.
“With it apparent that ANF’s rally by +93.9% from the 52-week bottom has occurred overly fast and furiously, with the premium valuations now offering interested investors a minimal margin of safety, pending the acceleration of its adj EPS growth in the double digits. … With the stock likely to at best trade sideways as it grows into its pulled forward upside potential and/or return part of its recent gains once the market rotation is no longer in play, I am of the opinion that its return prospects appear mixed at current levels.”
-
Dell Technologies (DELL): Sell by Invest Heroes. The analyst points to surging DRAM prices and constrained supply as key risks putting pressure on Dell’s margins across both its server and consumer segments.
“There is a growing imbalance in the semiconductor market: memory prices are rising rapidly due to demand from data centers, while manufacturers are limiting supply. This directly increases the cost of server hardware and consumer electronics, putting pressure on margins. … In this context, we view Dell Technologies as a company whose business model looks particularly vulnerable.”