Why These Tech Stocks Turned Around Today
While Fools should generally take the opinion of Wall Street with a grain of salt, it's not a bad idea to take a closer look at particularly stock-shaking upgrades and downgrades -- just in case their reasoning behind the call makes sense.
What: Shares of Netflix, and Yelp Inc both rallied about 2% today after Oppenheimer upgraded the pair of tech plays from Neutral to Outperform.
So what: Along with the upgrade, analyst Jason Helfstein planted a price target of $419 on Netflix and $78 on Yelp, representing upside of 24% and 19%, respectively, to Friday's close. So while momentum traders might be turned off by the tech sector's weakness in recent weeks, Helfstein's call could reflect a growing sense on Wall Street that it's starting to offer some attractively priced opportunities.
Now what: According to Oppenheimer, both Netflix and Yelp have favorable near-term technical support. "In our view, the recent sell-off in high-beta Internet and technology stocks has created a buying opportunity in certain stocks in our coverage universe," said Helfstein. "As we view near-term fundamentals as unchanged, we are upgrading the shares of NFLX and YELP to Outperform from Perform." More important, with both Netflix and Yelp boasting a rock-solid balance sheet and attractive long-term growth prospects, the downside might be limited enough to buy into that bullishness.
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The article Why These Tech Stocks Turned Around Today originally appeared on Fool.com.Brian Pacampara has no position in any stocks mentioned. The Motley Fool recommends Netflix and Yelp. The Motley Fool owns shares of Netflix. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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