Image Source: ESB Professional|Shutterstock

Summary

  • TD SYNNEX (NYSE: SNX) and Transphorm Inc. (NASDAQ: TGAN) saw broker recommendation revisions post the release of their financial results on June 27, 2023.
  • The mean recommendation rating on both these technology sector stocks stands close to a ‘Buy’ rating.
  • The consensus price target on SNX is US$ 112.09 and for TGAN it is US$ 6.50.

TD SYNNEX (NYSE: SNX) and Transphorm Inc. (NASDAQ: TGAN) released their financial results on June 27, 2023. Both the companies belong to the technology sector, with TD SYNNEX engaged in the cloud and cybersecurity arena and Transphorm being a semiconductor designer and manufacturer.

Analysts revised their ratings on these stocks soon after they released their financial results. The average recommendation rating on these stocks stands close to a ‘Buy’ rating. The mean recommendation rating on TD SYNNEX is 1.9 and that on Transphorm is 2.3 on a scale of one to five. Here one represents ‘Strong Buy’ rating and five represents a ‘Strong Sell’ rating.

The US technology sector has seen a bevy of challenging headwinds, ranging from widescale layoffs in the sector to the disruption caused by AI. TD SYNNEX and Transphorm also saw revenue slowdown during early 2023. However, brokers have retained a ‘Buy’ rating on these stocks.

Find out why brokers did not change their Buy ratings on TD SYNNEX and Transphorm. 

Raymond James upgrades TD SYNNEX (NYSE: SNX) to a ‘Strong Buy’ rating

Broker Raymond James bumped up TD SYNNEX to a ‘Strong Buy' rating on June 27, 2023. However, the broker reduced its price target on the stock to US$ 120, which is 32.09% higher than its previous closing price of US$ 90.85 on June 28, 2023.

Among other brokers that have covered the stock, Stifel Nicolaus and Barrington Research have given the stock ‘Buy’ and ‘Outperform’ ratings, respectively. An ‘Outperform’ or ‘Moderate Buy’ rating signifies that the stock is expected to perform slightly better than the market.

TD SYNNEX reported revenue of US$ 14.1 billion for the quarter ended May 31, 2023. This was 7.9% lower, sequentially. Meanwhile, TD SYNNEX’s operating income also fell 5.6% from the previous corresponding period to US$253 million.

SNX Price Chart; Image Source: EODHD/Others

The company’s dividend of US$ 0.35 per common share is payable on July 28, 2023, with an ex-dividend date of July 14, 2023

SNX has a P/E ratio of 12.6x as per Wednesday’s closing price. SNX’s dividend yield as on June 29, 2023, is 1.54%.

Analysts expect an 85% increase in Transphorm’s (NASDAQ: TGAN) stock price

As per EODHD/Others, the consensus mean price target on Transphorm is US$ 6.50, which marks an upside potential of 85.19% over Wednesday’s closing price. TGAN closed at US$ 3.51 on Wednesday, June 28, 2023.

Two of the four brokers that covered TGAN, namely The Benchmark and Craig Hallum, maintained their ‘Buy’ ratings on the stock after the company released its earnings. Meanwhile, B Riley Securities downgraded the stock to a ‘Neutral’ rating on June 28, 2023.

TGAN Price Chart; Image Source: EODHD/Others

The semiconductor producer reported a revenue of US$ 3.2 million for the March 2023 quarter, as against US$ 4.5 million in the previous corresponding period. At the same time, Transphorm reported a 21% y-o-y increase in its product revenue to US$ 14.7 million.