Wall Street analysts take a positive view of AI-driven Astera (updated)

Astera Labs,

15/04/2024 14:47

(Updates shares)
       April 15 (Reuters) - Wall Street brokerages started
coverage of Astera Labs  ALAB.O  mostly on a bullish note as
they see the company benefiting from a burgeoning market for
artificial intelligence (AI) tools.
    The Santa Clara, California-based company sells high-speed
semiconductor-based data transfer technology for AI and data
center applications and is positioned to gain from the AI boom.
    Shares of the chip firm rose 5.7% at $76.85 in early trading
on Monday after most of the ten brokerages assigned it a top
rating.
    J.P.Morgan and Barclays rated it "overweight" with a price
target of $85, following the expiry of the mandated quiet
period.
    The firm, which had its IPO last month, competes with chip
companies such as Broadcom  AVGO.O , Marvell Technology  MRVL.O 
and Parade Technologies  4966.TWO .
    Most brokerages cited the company's AI infrastructure
offerings, new market opportunities, and rising average selling
price (ASP) in their notes for the mostly positive views.
    Jefferies said the company has a path to over $1 billion in
annual revenue on back of multiple company-specific drivers
apart from its robust double-digit AI server unit growth. 
    Morgan Stanley believes Astera's products are leveraged to
the most important trends in computing, and has initiated
coverage of the stock with an "equal weight" rating.
    Astera's stock closed nearly 4% lower on Friday after rising
as much as 81% on March 26 since it started trading on March 20.
The stock traded as low as $50.61 on its debut.
    Earlier in March, Northland Capital had started coverage on
Astera Labs with an 'outperform' rating and a price target of
$85.

 Brokerage              Rating          Price Target
 J.P. Morgan              Overweight        $85
 Morgan Stanley         Equal-weight        $81
 Barclays                 Overweight        $85
 Deutsche Bank               Buy            $85
 Roth MKM                    Buy            $85
 Jefferies                   Buy            $85
 Stifel                      Buy            $81
 
 (Reporting by Reshma Rockie George in Bengaluru; Editing by
Tasim Zahid)
 ((Reshma.George@thomsonreuters.com;))