Chinese trade negotiators suddenly canceled a visit to meet U.S. farmers after they wrapped up trade talks in Washington this week.Marketsread more
Blackstone Executive Vice Chairman Tony James says he's less optimistic now than before that the U.S.-China trade war could be resolved, but even a smaller deal could help...World Economyread more
The Pentagon will deploy U.S. forces to the Middle East on the heels of the attack on Saudi Arabian oil facilities, United States Secretary of Defense Mark Esper announced...Defenseread more
President Trump also said he is "not looking for a partial deal" with Beijing, moving away from his suggestion last week that he would consider an "interim deal."Politicsread more
Progress on trade talks will determine how far market will move above new highs.Trader Talk with Bob Pisaniread more
"Sure, the trade war's taking its toll on business ... it's just not taking its toll where it was supposed to," Jim Cramer says.Mad Money with Jim Cramerread more
Joe Biden called on President Donald Trump Friday to release the transcript of a call with a foreign leader that is the subject of a whistleblower complaint. Biden described...Politicsread more
For investors taking a breather from the chaos in August, buckle up as the market is about go crazy again, Goldman Sachs warned.Marketsread more
Palantir Technologies is targeting a valuation of at least $26 billion in a private fundraising round, the first for the Peter Thiel-backed data analytics startup in four...Wall Streetread more
Michael Pack, a conservative filmmaker linked to Steve Bannon, saw at least $1.6 million in donations from his nonprofit sent into the coffers of his independent production...Politicsread more
The New England Patriots released Antonio Brown just 11 days after signing the wide receiver. The NFL Super Bowl champion team initially had kept him in the face of a rape...Sportsread more
The accelerating success of Alphabet's self-driving car unit, Waymo, spells big upside for stakeholders, according to Morgan Stanley.
The bank raised its price target for the tech titan to $1,515, the highest forecast of any Wall Street brokerage and implying more than 20 percent upside over the next 12 months.
For analyst Brian Nowak, Waymo's leadership in the global race to develop driverless cars had not been fully incorporated into investor expectations.
"We see the launch of Waymo's ride-hailing service by year-end as a potential catalyst for value realization," Nowak said in a note Wednesday. "We believe current Alphabet valuation ascribes little value for Waymo, implying it is still a call option."
He added that while Morgan Stanley currently values Waymo at $45 billion, the brokerage's research indicates the segment could grow to $175 billion in value as it expands its ride-sharing, logistics and licensing businesses.
Nowak's higher targets came just days after a business registration filing revealed that Waymo has established a subsidiary in Shanghai, the latest evidence that the U.S. internet giant is trying to break into the Chinese market.
For the driverless car unit, China offers business and logistics consultancy as well as car-part design and testing services. On the flip side, China has been trying to keep pace with the U.S. in the autonomous vehicle industry and could stand to benefit from having Waymo closer to home.
Alphabet's Google, which left China's search engine market eight years ago, has been actively seeking ways to rejoin the country where regulators block many of its products.
To be sure, Waymo still faces a number of key hurdles, including legislative challenges, expansion into new cities and adoption rates, Nowak said.
Recently, residents in a Phoenix suburb where Waymo has been testing its vehicles gave The Information a unanimous assessment of the cars: "I hate them." The backlash largely stemmed from frustrations with how the cars operate, including sudden stops or delayed turns.
The local complaints highlight the difficulties faced by self-driving cars, which are programmed to drive conservatively in order to master situations that humans ordinarily handle with ease.
Despite these early-stage hiccups, Nowak argued that operations should improve with time.
"As Waymo grows, we see investors putting a higher success likelihood and value on the asset," he said. "Every 10 percent realization of our total potential Waymo value translates to about $25 per share."
Shares of Alphabet's Class C stock rose 0.4 percent in premarket trading following the Morgan Stanley note.
In another note Wednesday, Nowak also raised Amazon stock's price target to a Wall Street high $2,500 per share.