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Dec. 20, 2011, 12:01 a.m. EST
Ms. Krishnamsetty is editor and co-founder of Insider Monkey, a finance website that provides free insider trading and hedge-fund stock-holdings data. Her articles draw upon the research and analytics of co-founder Dr. Ian Dogan, Insider Monkey's research director, who holds a Ph.D. in financial economics with a specialization in insider trading. Dogan has provided consulting services to institutional investors and hedge funds, and managed a $200+ million fund using a strategy he developed tracking insider transactions. Dogan authored the insider trading chapter of the soon-to- be-published "The Handbook of Investment Anomalies" by Zacks Investment Research. Prior to Insider Monkey, Krishnamsetty worked for Bloomberg Television, CNBC, NPR and in risk management at Marsh & McLennan. Krishnamsetty has an M.S. in Journalism from Columbia University's Graduate School of Journalism.
By Meena Krishnamsetty
Barclays /quotes/zigman/152323/quotes/nls/bcs BCS +6.10% has published its equity outlook for 2012. The report is dated December 13th and written by Stuart Linde and his equity research team. Barclays has given an overweight rating to the technology sector in the report. Below we discuss their top tech stocks for 2012.
Apple, Inc. /quotes/zigman/68270/quotes/nls/aapl AAPL +3.16% is in the IT Hardware space with a market cap of $354.12 Billion. AAPL's current price per share is $381.02, whereas Barclay's estimated target price per share is at $555.00. This is a very attractive stock considering the potential benefits from open-ended growth in iPad, iPhone, Macs and growth from China. Apple is poised to launch a new iPad line-up in the March 2012 timeframe, followed by a 4G LTE version of the iPhone (likely the iPhone 5) by the September 2012 quarter which will add to their already steady growth figures. Barclays rate the stock as overweight and the sector as positive. Hedge funds are extremely bullish about Apple. More than a third of the hedge funds we track have Apple in their portfolio.
Citrix Systems /quotes/zigman/55934/quotes/nls/ctxs CTXS +2.33% is in the software industry, namely the virtual desktop space, with a market cap of $11.95 Billion. CTXS's current price per share is $64.08 and Barclays expects this share price to stand at $87.00. CTXS should see ongoing healthy demand for its Cloud solution business which has become a leading growth driver for 2012. Barclays have also factored in a healthy revival of demand for the company's established XenApp business driven by customers' desire to interact with more existing applications on mobile devices like iPads. Barclays rates the stock as overweight and the sector as positive.
Corning Inc. is /quotes/zigman/223221/quotes/nls/glw GLW +0.72% a leading player in the lighting & display sector with a market cap of $20.56 Billion. GLW's current share price of $13.08 is expected to swell to a target share price of $17.00, according to Barclays. The potential for normalization in glass shipments with LCD TV demand coupled with near trough valuation levels, a share buyback program and an improving cash generation profile make this a buy recommendation by Barclays. Barclays rates the stock as overweight and the sector as neutral.
QUALCOMM, Inc. /quotes/zigman/77257/quotes/nls/qcom QCOM +4.20% is a leading vendor in the semiconductor market and founder of the CDMA/CDMA2K technology. QCOM has a market cap of $88.44 Billion. The current share price is $52.61, however Barclays' target share prices is $68.00. Heavy investments into the company's chipset platform are driving share gains. The company also collects royalty revenues on one of the leading mobile intellectual property portfolios in the industry. Smartphone growth - which Barclays models to be 43% y/y in 2012 - is rapidly lifting the share of CDMA-based phones. For these reasons Barclays has rated the stock as overweight. Qualcomm is one of the 10 most popular stocks among hedge funds ( see the complete list ).
Teradyne Inc. /quotes/zigman/243047/quotes/nls/ter TER +5.46% is a player in the semiconductor capital equipment space with a market cap of $2.43 Billion. The company's current share price is $13.20 and Barclays' projected target price per share is $20.00. Key drivers behind Barclays' positive recommendation include: 1) risk to consensus EPS estimates being on the upside now; 2) modest valuation relative to both semiconductor equipment names; and 3) underappreciated growth/margin prospects. Teradyne still trades at about a 30% discount to analog names which is expected to compress in 2012.
Tesla Motors Inc. /quotes/zigman/118681/quotes/nls/tsla TSLA +0.90% is a leader in the clean technology and renewables space with a market cap of $2.92 Billion. TSLA's current share price is $28.00 and Barclays estimated target price per share is $38.00. Barclays believe that TSLA is pursuing a much smarter early adaptor strategy - that of a premium-priced performance vehicle targeted at an affluent customer base which is willing to pay for innovation. The key variable to Tesla's success is not demand, but execution. If the company can meet the production expectations then Tesla stands to gain a potential upside of 20+%. The stock is currently rated as overweight and the sector as neutral.
Altera Corp. /quotes/zigman/67862/quotes/nls/altr ALTR +5.44% is in the semiconductors space with a market cap of $10.94 Billion. ALTR is currently priced at $34.09 per share but Barclays have projected a target share price of $42.00 per share. Barclays are bullish on ALTR as there are expectations for a recovery in communication infrastructure/industrial spending in 2Q12. Barclays have highlighted 3 growth drivers in their recommendation for this stock including 1) an outlook for market share gains to continue at the 40nm node; 2) a tailored architecture across all segments that should give the 28nm node an advantage; and 3) longer-term benefits from silicon convergence. Barclays rate the stock as overweight and the sector as positive. Boykin Curry's Eagle Capital had more than $250 million in ALTR at the end of September.
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