Analysts Bullish on Top Technology Picks

By George MacDonald

There’s a lot to be optimistic about in the Technology sector as 2 experts just weighed in on Square Inc. (NYSE: SQ) and 2U Inc. (NASDAQ: TWOU) with bullish sentimens.

Square Inc. (NYSE: SQ)

RBC Capital analyst Daniel Perlin reiterated a Buy rating on Square Inc (NYSE: SQ) on August 3 and set a price target of $15. The company’s shares closed yesterday at $11.32.

According to TipRanks.com, Perlin is a 5-star analyst with an average return of 10.9% and a 73.3% success rate. Perlin covers the Technology sector, focusing on stocks such as SS&C Technologies Holdings, Automatic Data Processing, and Jack Henry & Associates.

Currently, the analyst consensus on Square Inc is Moderate Buy and the average price target is $13.59, representing a 20.1% upside.

In a report released yesterday, Barclays also maintained a Buy rating on the stock with a $15 price target.
2U Inc. (NASDAQ: TWOU)

In a report released today, Brian Schwartz from Oppenheimer reiterated a Buy rating on 2U Inc (NASDAQ: TWOU), with a price target of $38. The company’s shares closed yesterday at $35.01.

Schwartz wrote, “2U reported a good second quarter with above-consensus results and higher 2016 guidance. The results support our long-term thesis that 2U has created a highly unique and defensible business that’s scaling into an open-ended growth opportunity. On balance, profit margins exhibit good improvements y/y, but the magnitude of improvements is starting to moderate. Additionally, no new programs were announced though pipeline commentary is bullish. Bottom Line: We believe 2U’s School-as- a-Service story is on a strong trajectory, and that its bundled services (marketing/ recruiting, content development, technology infrastructure management, etc.) and referenceability make it very attractive to universities while its long Tier 1 revenue growth visibility (30%+) mitigates execution risk. Last, an approaching EBITDA inflection/sizable step-up in 2017 and 2018 could entice new investors and/or lead to multiples expansion.”

According to TipRanks.com, Schwartz is a top 25 analyst with an average return of 22.0% and a 73.3% success rate. Schwartz covers the Technology sector, focusing on stocks such as Concur Technologies, Palo Alto Networks, and Callidus Software.

Currently, the analyst consensus on 2U Inc is Strong Buy and the average price target is $37.50, representing a 7.1% upside.

In a report issued on July 25, Pacific Crest also reiterated a Buy rating on the stock.