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Shares of GlobalFoundries Inc. (GFS) rose by more than 3% in morning trade on Wednesday as analysts at Morgan Stanley expressed optimism about the company’s long-term growth prospects.
According to TheFly, Morgan Stanley analysts hiked their price target to $42 from $40, reiterating their ‘Equal Weight’ rating on the stock. The GlobalFoundries stock was trading near the $42 level at the time of writing.
While the brokerage noted that GlobalFoundries' first-quarter (Q1) guidance was below expectations, it observed that the company's long-term growth outlook remains constructive.
GlobalFoundries posted earnings per share (EPS) of $0.46 during the fourth-quarter (Q4), ahead of Wall Street’s estimates of $0.45, according to Stocktwits data.
It guided for revenue between $1.55 billion to $1.60 billion, below a consensus estimate of $1.66 billion for the first quarter, according to FinChat data.
The company’s data center and automotive segments drove its topline during the quarter, which grew 18% and 30% year-on-year, respectively.
Analysts at Baird also underscored that GFS remains well-positioned for a rebound after a tough first quarter.
The brokerage has an ‘Outperform’ rating on the GFS stock, with a price target of $50. This implies an upside of over 20% from current levels.
Retail sentiment on Stocktwits around the GFS stock was in the ‘extremely bullish’ (81/100) territory, while message volume was at the ‘extremely high’ levels.
GlobalFoundries’ stock declined nearly 4.6% over the past six months. However, its one-year performance is worse, with a fall of over 26%.
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