Falling demand for computers and electronics has made Morgan Stanley analysts even more bearish on 3 PC stocks.
Morgan Stanley analyst Erik Woodring reiterated the underweight/sell rating on these 3 stocks on Friday (4th): HP (HPQ-US)、Cricut (CRCT-US) and Logitech (LOGI-US), citing pessimistic results from the investment bank’s recent survey of consumers.
He wrote: “While our AlphaWise Consumer Pulse Survey, conducted in late October, showed that sentiment has largely stabilized, the consumer hardware/PC data is deteriorating. Since the end of the quarter, caution has intensified, which may Putting increasing downward pressure on consumer hardware valuations.”
As China’s new crown epidemic situation is expected to change substantially, the U.S. stock market rose on Friday, and technology stocks generally rose. HP and Logitech both closed up more than 6%, but Cricut fell 4.12%.
Woodring reiterated a price target of $24 for HP, $5 for Cricut, and $39 for Logitech.
None of the three companies immediately responded to requests for comment on the Morgan Stanley report. HP makes PCs, while Logitech and Cricut make PC peripherals.
The analyst said that the survey showed that this year’s shopping holiday will reduce purchases of consumer electronics and personal computers. The number of respondents is three times that of last year, and more than 70% of the respondents said they will wait for special discounts before spending. .
“Not only that, but consumers’ net willingness to spend on hardware over the next six months hit a new low in the survey.”
Throughout 2022, the PC sales outlook has been deteriorating. According to research firm IDC, global PC shipments fell 15% in the second quarter following falling 5% in the first quarter of this year (through March). PC shipments also fell 15 percent in the third quarter, IDC said on Oct. 10.
PC processing chip maker Intel (INTC-US) and AMD (AMD-US) in recent weeks reported quarterly earnings for the September quarter, all forecasting revenue for the quarter ending in December well below Wall Street expectations for no surprise: PC demand is trending weak.