Here’s the most recent edition of Market Talks, focusing on Technology, Media, and Telecom. Find it only on Dow Jones Newswires, released at 4:20 AM ET, 12:20 PM ET, and 4:50 PM ET.
1402 ET – According to Deutsche Bank analysts, Spotify’s recent price hikes in select nations reveal a pattern: invest in a new content category, boost user activity, and then increase prices. The streaming service’s more-than-anticipated price jumps in Germany, Austria, Australia, and Liechtenstein seem to be linked to its audiobooks and potentially its video podcasts, the analysts suggest. They predict that the increases will improve profit margins due to the greater profitability of non-music content, potentially generating roughly 50 million euros in additional revenue in the fourth quarter and another 350 million euros in revenue in 2026.kelly.cloonan@wsj.com)
1147 ET – Wedbush analysts stated in a report that Palo Alto Networks’ upcoming quarterly results are expected to demonstrate ongoing strength in cybersecurity deal activity. They believe the company’s platformization strategy is gaining momentum as it moves towards fiscal year 2026. The analysts consider the cybersecurity firm a top pick for investment over the next year and a half, citing its increasingly reliable pipeline and recent growth in deal flow. They see the recent decline in Palo Alto’s stock, linked to the CyberArk Software acquisition, as an ideal buying opportunity, as the company finalizes its platform approach to offer a comprehensive cybersecurity solution. The stock is currently up less than 1%, trading at $175.14.denny.jacob@wsj.com; @pennedbyden)
1113 ET – According to Mizuho analysts, Sandisk is experiencing increased demand as advanced AI models move beyond traditional data center applications. In a research note, they highlighted Sandisk’s prominent role in the NAND flash market, noting its robust presence in consumer, client, and cloud sectors. While Sandisk’s most recent quarterly results exceeded expectations for both revenue and earnings per share, their subsequent third-quarter forecast was less optimistic. Despite a 10% drop in share price after Thursday’s trading session, analysts believe this response was an overreaction, citing the company’s ongoing positive trajectory within the NAND flash market.natalie.weger@wsj.com; @NatalieWeger)
11:08 ET — According to Bank of America analyst Vivek Arya, Applied Materials’ disappointing forecast for the fourth quarter suggests the company could be losing ground in the semiconductor market. Arya has downgraded the stock to neutral as a result. While the company cited inconsistent customer demand due to economic instability, Arya believes the downturn might be unique to Applied Materials. He suggests that competitors are gaining market share in the wafer fabrication equipment sector, especially in foundry/logic applications. Applied Materials may also be heavily invested in slower-growing product areas, like mature node semiconductors that are currently oversupplied. The stock price has fallen by 12% to $164.73.nicholas.miller@wsj.com)
1033 ET – WELL Health Technologies’ investment in the Canadian market appears to be yielding positive results following a robust second quarter. According to a report by CIBC analysts Scott Fletcher and Erin Kyle, the company’s Q2 performance was strong, with revenue slightly exceeding expectations and adjusted EBITDA surpassing estimates by 3%. They highlight WELL’s ongoing emphasis on expanding its Canadian operations, evidenced by the acquisition of three clinics during the quarter and an additional four after the quarter concluded, contributing C$23 million in annual revenue. “The Canadian business demonstrated impressive performance this quarter, with revenue from Canadian patient services and SaaS and Technology increasing by 40% year-over-year and 25% organically,” they stated. Meanwhile, discussions regarding asset sales are ongoing, and WELL remains dedicated to divesting its patient care and digital delivery businesses in the U.S., the analysts added.adriano.marchese@wsj.com)
0941 ET – Raymond James analyst Brian Vaccaro believes Wing Stop’s “Smart Kitchen” technology is revolutionizing the company. As a result, he’s upgrading the stock from outperform to strong buy. This system, which replaced paper tickets and utilizes AI to predict demand and prepare for busy periods, is yielding promising outcomes. Restaurants using the technology have seen ticket times cut in half, increased customer satisfaction, and delivery times under 30 minutes. Vaccaro anticipates these improvements, along with a new loyalty program slated for 2026 and a record-high franchise development pipeline, will fuel annual EBITDA growth in the high teens to low 20s for the next several years.nicholas.miller@wsj.com)
0902 ET – According to D.A. Davidson, Salesforce’s current stock price accurately reflects the difficulties it faces, including slowing organic growth in its primary operations and increasing competition. Consequently, the investment bank is raising its rating on the stock from underperform to neutral. Analysts Gil Luria and Clark Wright also noted in their research report that Starboard’s larger investment in the company could push management to prioritize growth in its main business areas. The analysts are sticking with their $225 price target. Before the market opens, Salesforce shares have risen by 1% to $236.50.denny.jacob@wsj.com; @pennedbyden)
0852 ET – Geoff Kendrick of Standard Chartered points out in a report that the most noteworthy aspect of the recent 13F filing from the U.S. Securities and Exchange Commission is Norges Bank, Norway’s central bank, upping its bitcoin investment in the second quarter. He notes that Norges Bank purchased stock in bitcoin-holding firms Strategy, previously called Microstrategy, and Metaplanet. “During the second quarter, their bitcoin-equivalent holdings grew from 6,200 to 11,400 bitcoins, marking an 83% rise.” While Norges added a minor bitcoin-equivalent stake in Metaplanet, the majority of this position is still held in Strategy.renae.dyer@wsj.com)
0440 ET – According to CGS International analysts, Tencent’s various business divisions are poised for significant expansion, fueled by the integration of AI technology over the next three to five years. Their research note anticipates increases in Tencent’s third-quarter gross profit margin and adjusted operating profit margin to 56.4% and 38.2%, respectively, following the company’s surprisingly strong second-quarter earnings. The analysts also foresee ongoing revenue growth and have increased their earnings per share (EPS) predictions for 2025-2027 by 1.4%-3.1%. However, capital expenditures related to AI are expected to be higher in the second half of the year compared to the first, following U.S. approval for Nvidia to resume sales of its H20 AI chips to China. The brokerage firm has increased its target price from HK$654.00 to HK$693.00, reiterating an “add” rating. Shares ended the day up 0.3% at HK$592.00.megan.cheah@wsj.com)
0049 ET – According to Citi analysts, Lenovo Group is in a strong position to capitalize on the expanding markets for AI infrastructure and edge AI. In a research note, they suggest that the company’s adaptability in product creation, production, and supply-chain management should enable it to weather macroeconomic instability. Despite exceeding fiscal first-quarter profit expectations, Lenovo’s stock price declined on Thursday, likely due to a combination of weaker gross profit margins and profit-taking following a recent surge. Nevertheless, Citi finds Lenovo’s stock appealing, citing its strong underlying performance and appealing valuation. Maintaining a buy rating on Lenovo, Citi has increased its target price from HK$13.30 to HK$13.60, reflecting a positive outlook. The stock was last trading at HK$10.65.sherry.qin@wsj.com)
0004 ET – According to a Daiwa research note, NetEase’s game revenue is projected to increase in the third quarter, driven by significant game updates. Analysts highlight that substantial updates to established games like “Once Human” and “Identity V” were released in July, creating strong momentum as the third quarter begins. Daiwa anticipates a surge in online game revenue growth to 16.5% year-over-year in the third quarter, primarily due to the weak performance in the latter half of 2024 caused by adjustments to “Fantasy Westward Journey” and “Eggy Party.” Furthermore, they believe that the recently released “Marvel Mystic Mayhem” still has potential to boost its earnings, as NetEase intends to release content updates every six weeks to retain its one million player base. Daiwa has increased its target price for the Chinese video game company from HK$235.00 to HK$260.00, maintaining a buy recommendation. The stock was last trading at HK$204.80.sherry.qin@wsj.com)
2358 ET – Morgan Stanley’s analysts who are optimistic about Telstra are closely monitoring the Australian firm’s novel satellite experiments. They view these trials as a means for Telstra to solidify its dominance in connectivity. According to them, this leading position is crucial for Telstra’s stock to sustain its high valuation compared to similar companies. They inform their clients that the stock’s value would likely decrease if a competitor were to seize the lead in satellite connectivity, a vital factor in a nation with extensive regions lacking robust infrastructure. Morgan Stanley has slightly reduced its target price by 1% to A$4.95, while maintaining an “overweight” rating on the stock, which has decreased by 0.2% to A$4.84.stuart.condie@wsj.com)
2245 ET – According to HSBC analysts in a research report, NetEase’s disappointing second-quarter results probably won’t stop its comeback. While NetEase has stopped reporting mobile and PC game revenue separately, HSBC estimates a 1% year-over-year decrease in mobile game revenue and a 66% increase in PC game revenue. They attribute the lower-than-expected net profit in the second quarter to increased marketing expenses for games that later achieved top rankings in July and August. “We believe the investment was worthwhile,” they stated. HSBC is raising its third-quarter game revenue growth forecast to account for the strong performance of its game titles this summer. HSBC is still recommending buying NetEase shares but has lowered its ADR target price from $158.00 to $157.00. The most recent closing price for its ADRs was $129.67.sherry.qin@wsj.com)
