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October 2017

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Mizuho analyst Vijay Rakesh raises price target on Micron Technology to $20

Vijay Rakesh, an analyst at Mizuho Securities, released a research note today, wherein he raised his 12-month price target on Micron Technology, Inc (NASDAQ:MU) stock to $20 from $15. The analyst also reaffirmed his Outperformed rating on the stock.

Furthermore, the analyst mentioned in his research note that he projects that a stable to improving DRAM spot coupled with contract pricing would prove to be an upside for the chip maker’s gross margins. Micron recently faced disruptions in the production of DRAM, and the analyst believes that this should bring about a favorable impact on pricing, creating a tailwind into peak build. Historical trends show that the tech company’s stock price tracks gross margin and an inflection point occurring in the margins during second half of 2016 could prove to be a plus point for Micron stock.

The analyst also predicts a top-line tailwind fueled by the NAND bit growth during 2HFY16, primarily stimulated by 3D-NAND. Mr. Rakesh also highlights that the company will pay attention to a positive Free Cash Flow (FCF) during the fiscal year 2017.

On Friday, Needham & Company analyst Rajvindra Gill also covered the stock in his research report; the analyst reaffirmed his Underperform rating on the stock. The same day, the stock jumped about 2% during the intra-day trade, following a report regarding a minor mistake in DRAM production which forced the Korean vendor to scrap around 30,000 to 50,000 wafers from the 21nm node.

However, Mr. Gill refuted these claims, backing his thesis with a conversation with the supply chain contacts and mentioned that these claims are unsubstantiated. Needham analyst also highlighted that although the DRAM pricing environment has improved, which was mainly because of a better PC DRAM pricing situation, the company still has an excessive inventory pile-up.

Micron stock currently trades at $16.17, down about 0.49% as of 11:37 AM EDT. The stock has outperformed the S&P 500 Index since the start of this year through August 19, as it spiked about 15% in comparison to the index’s gain of 7% during the same time span.

Verizon has tough decisions to make amid news of the data breaches

Yahoo! Inc. (NASDAQ:YHOO) had finalized a deal to sell off its core business to Verizon Communications Inc. (NYSE:VZ). It also came into light that after acquisition, the name of the company will be changed. The technology giant said on Monday that the deal will be completed till the second quarter of 2017, instead of the initial plans to complete it in the first quarter.

The business of the fading technology giant improved in the fourth quarter of 2016 amid various challenges and news. The news of the Verizon takeover did not distract the company to a great extent. The improvement in the fourth quarter comes at a time when investigations are being done against the company regarding the two data breaches that were disclosed by the company.

Yahoo! had clarified that the company did not experience a drop in users even after the disclosures of the two breaches as a response to its acquirer, which said that the value of the technology giant had fallen due to them. The deal between the two companies stand at a value of $4.8 billion.

In its quarterly earnings release, CEO Marissa Mayer said,With our 2016 and Q4 financial results ahead of plan, and the continued stability in our user engagement trends, the opportunities ahead with Verizon look bright.” In her five years with the company, she has failed to turn it around.

A Verizon spokesman while commenting on the issue said that they are looking for the damage the data breaches have done to the value of Yahoo!. He further said that they have some difficult decisions to make as a result of those breaches.

Yahoo! shares gained 0.83% and closed at $42.40 in the last session. The market share price of Verizon closed at $52.41, depicting a fall of 0.59% of its value for the day.

Stifel remains extremely bullish on Micron and Western Digital stock despite weakness

Several players in the data storage space, including the likes of Western Digital Corp (NASDAQ:WDC), Micron Technology, Inc (NASDAQ:MU) and Seagate, have faced growing pressures from their shareholders since the start of fiscal year 2015 based on the poor NAND fundamentals and industry-wide weakness. The aforementioned names also came under attack in the last trading session, after Micron posted weak results for its third quarter earnings call.

However, analysts at Stifel issued positive comments about the entire memory space during yesterday’s trading session, after meeting with a flash memory expert. The research firm believes that NAND prices have somewhat stabilized in the last couple of quarters, removing the excessive pressure on the providers of electronic data products. Analysts at Stifel remain “extremely bullish” on the future prospects of NAND Flash memory companies, such as Micron and Western Digital.

During the trade yesterday, Micron Technology stock nosedived after the company revealed its third quarter results. The company provided weak top line results, which fell behind its consensus estimates. Micron reported $2.9 billion in total revenues, coming close in exceeding the Street’s expectations of $2.96 billion. Additionally, the company posted adjusted loss per share (LPS) of 8 cents beating the Street’s estimates by a single cents.

Furthermore, the memory chipmaker revealed poor earnings outlook for its current quarter, expecting to post LPS between 24 and 16 cents, missing its consensus estimate of positive 4 cents. In a bid to reverse its misfortunes, Micron’s chief Mark Durcan announced a new restructuring plan which includes global job cuts and other cost saving initiatives to generate $80 million per each quarter in fiscal year 2017.

Despite reporting weak quarterly results, several analysts on Wall Street defended Micron Technology. Micron stock has now slipped roughly 12% since the start of calendar year 2016, compared to its peer Western Digital which witnessed a decline of approximately 24% in similar time frame.

Get your purchase before it expires

Alan Wake’s two post-launch expansions titled “The Signal” and “The Writer” are completely free on Microsoft Corporation (NASDAQ:MSFT) Xbox Live. The expansions can be purchased for Xbox One or Xbox 360.

Head over to the Xbox Store and initiate your download. Click here to download The Signal and here to download The Writer. This is of course from the web and only places them in your purchase list. The download will begin once you log in to your Xbox One or Xbox 360.

Alan Wake was made available for free with Quantum Break, Remedy’s latest time-bending cinematic action game for Microsoft platform. It is a nice gesture on Microsoft’s part to deliver a complete experience by providing the two expansions for free as well. This is assuring fans who have yet to play the game to enjoy the full Alan Wake experience.

Remedy has always aimed for a cinematic story-telling in their games and the 2010 psychological thriller is no different. While it was not ground-breaking, the game is worth a play at the very least.

We don’t know if this is offer is going to stick around forever or just a temporary promotion (or even an error). So with that in mind, better use the opportunity and grab them. The two expansions cost $10 each otherwise. That’s a $20 saving for you.

Steps by the Obama Administration were sparked by Army Corps of Engineers, that denied granting any permission to KMI to go under the Missouri River reservoir

As if previous objections of constructing the Dakota Access Pipeline had not proved to be disgraceful enough, another issue becoming a hurdle in the development of the pipeline has emerged. As reported by the Wall Street Journal, the request filed by Energy Transfer Partners (NYSE:ETP) for quick approval of the pipeline has been refused by the federal judge on Friday.

However, U.S. District Judge James Boasberg added that the issue will be looked upon again next year and asked the lawyers of Energy Transfer to file motions by the end of January 2017. The Obama Administration curtailed the expansion of the key pipeline on Sunday. Coming ahead of the refusal for permit required to complete the route, Justice Department and lawyers of the company issued a request to pressurize the federal government into approving the completion of the route.

It shall also be noted that steps by the Obama Administration were sparked by Army Corps of Engineers that denied granting any permission to KMI to go under the Missouri River reservoir. This happens to be the last link to be built in the 1,200-mile crude pipeline.

The Army Corps of Engineers along with the Standing Rock Sioux tribe hold massive objection for the expansion of the pipeline. Maintaining that the stance that developing the final link and completing the route could contaminate their water supply, the tribe asked U.S. District Court in Washington, D.C. to curtail the project.

The protests do not come as surprising as with the passage of time. Awareness regarding the detriments of fossil fuels for human health and the entire planet are increasing. However, on the flip side, Energy Transfer argues that Army Corps of Engineers had earlier given in their consent for the construction and thus the final approval is nothing but a “ministerial” document. By and large, the decision by the federal judge could be mooted, as President-elect Mr. Donald Trump, who would acquire office next month, is highly supportive of the pipeline project.

The Country Caller discusses what the Model 3 reservation holders think of Tesla’s mass-market electric sedan

Tesla Motors Inc. (NASDAQ:TSLA) has created a lot of excitement in the market over its latest mas-market offering, the Model 3. In fact, Teslarati has a list of the most popular configurations for the $35,000 vehicle from Model3Tracker.info. The crowd-sourced database, based on a sample of 1,637 Model S reservations holders, provides insight on how the auto maker could ramp up its mass-market production plans in 2017.

Battery Pack & Supercharging

Model 3’s base model is expected to have range of at least 215 miles per charge. Yet, 75% of customers want larger battery packs with a higher range, and they are presumably willing to pay more for getting more driving freedom.  Since there is a high possibility that Model 3 owners might have to pay for availing the Supercharging service, a staggering 90% are ready go that extra mile to use the world’s fastest-charging stations.

Drivetrain & Performance

Although the company’s recently-launched premium SUV, the Model X, comes with the all-wheel drive (AWD) standard, Tesla will offer the rear wheel drive (RWD) as default. Still, 78% want additional torque in their vehicles by having the D versions.

The Model 3 is expected to accelerate from zero to 60 mph in just six seconds. Interestingly, 63% of the reservation holders are content with that performance level. While 22% are looking for more performance upgrades, 15% want the amazing “Ludicrous” mode in the electric sedan.

Roof Option & Towing Ability

During the event, guests were delighted to have extraordinary visibility with an all-glass panoramic roof in the Model 3 prototypes. Even if the technology is not available as a standard, 72% would spend more to have the all-glass roof; 14.5% of the customers believe that a solid-metal roof as standard option would be good enough. Although CEO Elon Musk showed that the vehicle could have towing ability, merely 15% are interested in the tow hitch and 17% want the accessory hitch.

Autopilot, Suspension, & Sound System

Autopilot gradually became a key offer in a Tesla car and an unsurprising 88% demand the Autopilot Convenience feature. Majority of them are satisfied with having no suspension package and stand-sound system.

Wheels, Interior, & Premium Package

Notably, 79% of customers really like the standard wheel offer and do not plan to shift to larger ones. 52% and 58% of them would like to have the Subzero Weather Package and Premium Updates Package as an option, respectively.

The key to profitability is focusing on the existing resources than making space for the future ones

Electric carmaker Tesla Motors Inc. (NASDAQ:TSLA) seems to be losing its charm among investors lately. TheCountryCaller’s bearish views on the EV maker persist ever since it was trading above $220. Now that its market price has dropped significantly to below $200, it seems that Elon Musk is looking to revive the spirit of his employees, as they feel a bit dissuaded about the twelve-year-old company’s future. In a recent address to his employees, the billionaire said that he is determined to change the company’s image from an “automaker that continues to burn cash” to a “profitable and innovative company.”

While that may seem too easy to say, it is equally difficult to implement it, in our view. Mr. Musk’s approach is forward looking as we’ve previously discussed, however, the key to profitability is focusing on the existing resources than making space for the future ones. Certain KPIs need to be in place if Tesla is to show profitability. Given the company’s edge over its competitors, it is not that difficult to turn into profits, given that the approach is disciplined.

That being said, he reckons Q3 as the last chance for Tesla to win over its investors. Even in the last quarter, we did discuss a few positive things such as operational efficiency; however, to sustain the performance has been a challenge. Moreover, as we’ve discussed, the $30 billion company is undergoing difficulties in obtaining funds, which might just not appear good to investors. Moreover, it is also asking investors to extend their aid in financing the upcoming projects, which increases the uncertainty among them.

However, if certain measures such as tight cost control are implemented effectively, and a focus on present than future becomes a priority, then we may see some positive developments coming out in the next quarter.

The Cupertino-based outfit has to be given top marks for acting quickly to quell any problems related to battery in its future devices as patent shows

In times where battery explosions are the norm in smartphones, Apple Inc. (NASDAQ:AAPL) has filed a patent which would allow them to have a new battery design. The new design would allow the battery to increase performance and protect the battery so that it doesn’t explode.

The company looks to tackle two problems through this patent. The company’s iPhones 7 has been listed as having the worst battery of any of the flagships of 2016. Now, if the new patent increases performance of the battery, it might help it in this regard. The company’s phone, if compared to HTC 10, lasts 20 hours less when on call on a cellular network. The gap in between the two devices is substantial and Apple might have the same thing in mind while filing for the patent.

Secondly, Apple devices have been blowing up as well, along with the Galaxy Note 7. The company filed for the patent in Q2 of 2016, so it might not have had any idea about the battery fiasco we do now. But it might have had some indication of the danger, because of which it looked to file for the patent. Maybe it might have foreseen the explosions of the iPhone device, which have taken place recently, or just might only be looking to make their devices better, we’ll never know.

If the patent makes it to the devices of Apple, the company would be given full marks for being proactive. Samsung Electronics Co. (SSNLF) has given a better account of not being proactive in its fight against the battery problem which has plagued its Galaxy Note 7 device. It might need it as the company is also coming under fire due to the explosion of older cell phone models such as the iPhone 6S Plus in the most recent incident.

The incident took place in Fresno, where a woman was awoken by a sudden jolt. The jolt was her burning phone which she left on charge on her dresser. The woman had to call the authorities due to the incident. In a fight against such explosions, we at The Country Caller certainly believe that Apple is heading in the right direction. However, it might have them reconsider about the design of the phone as the figures show the new casing to be a little bulky. However, it does go onto say that the shape can be molded into any form and can be used for any other devices as well, such as the iPad, iPod, MacBook, etc.

Based on slow demand from the market and to focus on other new jets, Boeing plans to reduce monthly production of 777 aircraft

Most recently Boeing Co (NYSE:BA) announced plans to further reduce production of its wide-body twin engine 777 commercial aircraft amid reduced demand from the market. As part of the current news, the aircraft manufacturer would now manufacture five 777 commercial jets per month starting from August 2017; the move represents a 40% reduction as compared to current production rate of 8.3 jets per month.

Boeing associates the reduction to the changes in its spending on the new variants; however, industry analysts are of the opinion that the cut is expected to put pressure on the company along with its suppliers as they will still have to meet the revenue targets. On the plus side, the move would enable the aircraft manufacturer to keep production line running for longer period, expanding current model’s life span.

On the other hand, investors don’t seem pleased with the decision as the BA stock was down during yesterday’s trading session. In order to retain investor confidence, the company announced plans to continue increasing dividends by 30% and also looks ahead to authorize an additional $14 billion share buyback program.

As for employees, Boeing’s strategy would affect headcount at its production facilities. On the flip side, the company remains confident that the current decision would not affect financial forecast for fiscal year 2016 (FY16). The word has surfaced the industry that the production gap will be taken over by manufacturing of revamped 777X variant, which is due to enter service in FY20.

We believe Boeing needs to fetch orders at a growing pace in order to stick with the latest production rate of its 777 commercial aircraft. However, based on slow demand of double aisle commercial aircraft from the market, the company is expected to face tough times acquiring more orders in future.

Numerous smartwatches are set to be announced at the IFA 2016 Event which will directly compete with the Apple Watch 2

Apple Inc. (NASDAQ:AAPL) is only a week away from hosting its September Event where it is highly expected to announce its next generation Apple Watch, along with the upcoming iPhone 7. However, the Cupertino-based tech giant is set to receive a lot of competition from rival smartwatch makers which could undermine the sales performance of its upcoming Apple Watch 2. The IFA 2016 Event is almost upon us where the biggest competing smartwatches to the Apple Watch 2 are set to be revealed. Here is a quick review of the most anticipated smartwatches to be unveiled at the upcoming IFA 2016 event.

Samsung Galaxy Gear S3: Undoubtedly, this is the biggest competition for the upcoming Apple Watch 2. Samsung has already made major waves in the smartphone world after unveiling its Galaxy Note 7 and the tech giant is highly expected to turn more heads around with the announcement of its next generation Galaxy Gear smartwatch. Reliable sources speculate that the upcoming device will sport a similar design and form factor but it will incorporate substantial upgrades to its GPS, speedometer, barometer and also its altimeter.

Fitbit Charge 2 and Fitbit Flex 2: If there is one smartwatch that can outmuscle the current Apple Watch in terms of fitness tracking, is the Fitbit wearable. Even though both Fitbit Charge 2 and Fitbit Flex 2 are not meant to function like a smartwatch but they do bring highly effective features for fitness enthusiasts. Both devices offer a substantial upgrade in design and performance, as compared to their respective predecessor models. Hence, the upcoming Apple Watch 2 better watch out.

Microsoft Band 3: The current generation Microsoft band is designed to support Windows 8.1 devices. Hence, the time is right for the software giant to release its next generation Microsoft band, in order to cater to the latest Windows 10 devices. There have been numerous reports of a prototype of the Microsoft Band 3 under tests, so there is high probability that we will get a glimpse of the upcoming smartwatch during the IFA 2016 Event.

Sony Smartwatch 4: The Japanese tech giant is long overdue to release the fourth generation version of its Sony Smartwatch, so it is highly possible that it will make such an announcement during the upcoming IFA 2016 Event. Top tech analysts predict the tech giant to incorporate slight upgrades like better waterproofing, improved GPS functioning and enhanced NFC capabilities on its upcoming Sony Smartwatch 4.