NextEra Energy -- NEE-NYSE Buy -- $80 on Oct. 21 by Melius Research Leverage to significant growth in Florida and numerous other states and a best-in-class power-generation development business in Energy Resources make NextEra a high-quality way to invest in the significant increase in power demand under way in the U.S. Against the data-center hub targets laid out at the 2025 investor conference -- 15 gigawatts of new generation for large load by 2035 with a 30 gigawatts upside case -- the company's origination channels should comfortably meet and beat both. The diversified mix of natural gas, nuclear, and renewables provides numerous solutions to drive and sustain significant earnings, cash flow, and dividend growth well into the next decade.
In addition, NextEra is absorbing Dominion Energy in an all-stock deal that creates one of the largest energy companies in the U.S. by enterprise value. Power demand is entering its steepest growth cycle in a generation, inflected upward by the artificial-intelligence data-center buildout, electrification, and reshoring. NextEra is structuring itself to be the only company with the balance sheet, supply chain, and operating platform to meet that demand at scale. Target price: $100.
Lithia Motors -- LAD-NYSE Buy -- $299.53 on Oct. 21 by Seaport Research Partners Lithia Motors reported third-quarter 2026 adjusted earnings per share of $10.34, which compares to our/consensus forecasts of $9.88/$9.70, respectively (although note that roughly three weeks ago, consensus was $10.09). The print was clean, the result of solid all-around performance, particularly in certain areas such as used-vehicle gross profit per unit and selling, general, and administrative expenses as a percentage of gross profit. A low tax rate helped by 18 cents per share, but even adjusting for that, adjusted EPS would have been a strong $10.16.
The other positive driver versus our forecast was a low share count, which helped by 22 cents per share. There were some puts and takes in the quarter, with revenue ahead and gross margins slightly light (although much better than feared), but SG&A was well controlled and relatively stable on a sequential basis. Target price: $490.
Bending Spoons -- BSP-Nasdaq Buy -- $45.55 on Oct. 21 by StoneX Equity Research While investors will naturally focus on revenue, adjusted operating income, organic growth, and forward guidance, we believe that individual quarterly variations are less determinative of Bending Spoons' long-term thesis than they would be for a traditional SaaS/software company....
Quarterly execution matters, but compounding matters more. We believe that investors should focus on whether Bending Spoons can consistently compound revenue, cash flow, acquisition capacity, and intrinsic value per share over many years rather than allowing the noise of any single quarter to dominate the investment debate....
We reiterate our Buy rating and $50 price target on Bending Spoons ahead of third-quarter 2026 results.
Super Micro Computer -- SMCI-Nasdaq Buy -- $32.49 on Oct. 21 by Needham Super Micro Computer provided preliminary fiscal first-quarter 2027 results that call for revenue to come in above the high end of its prior guidance. Revenue in the fiscal first quarter is now expected to be $19 billion at the midpoint versus $15 billion previously. The increased revenue outlook is driven by increased demand for AI platforms.
Additionally, Super Micro now expects GAAP and non-GAAP gross margin to be 12.0% to 12.5%, above its prior guide of 10.4% to 10.8%. The better-than-expected GM is attributed to favorable customer and product mix. We continue to expect Super Micro's backlog strength to continue following record levels of more than $60 billion reported last quarter. This momentum is expected to be driven by the ramp of next-generation AI systems.
Our target price remains $46, based on about a seven times price/earnings multiple of our new calendar-year 2028 non-GAAP EPS estimate.
Snowflake -- SNOW-NYSE Outperform -- $319.61 on Oct. 21 by Evercore ISI Snowflake has pulled back with the broader AI trade over the past week, and we think that's understandable given that Snowflake shares have basically tracked the VanEck Semiconductor exchange-traded fund over the past year (+46% year to date vs. +52% for the ETF).
However, after catching up with Snowflake's CEO recently and a series of discussions with customers and partners, including at Snowflake's recent New York City user conference, we come away from those events feeling good about the beat/raise path for Snowflake heading into the second half, and ultimately into fiscal 2028. At about 14 times enterprise value/calendar-year 2027 sales, we believe the valuation remains attractive for a business pushing toward 40%-plus product growth with steady margin expansion....
When looking ahead to calendar 2027 (fiscal 2028), compares will get tougher starting in the fiscal second quarter, but Street estimates have the potential to move higher....
The bottom line is there's a very practical beat/raise path ahead of Snowflake, and the recent pullback creates an attractive entry point for longer-term investors. Target price: $430.
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