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New Stock Coverage: Analysts Have Huge Candy Crush on King Digital Entertainment

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Wall Street ratings agencies set the tone for today's stock market.

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King Digital Entertainment (NYSE:KING), the maker of utterly addictive mobile game Candy Crush Saga, endured an awful initial public offering in March even as the overall market boomed. Today, however, a crush of bullish analysts -- I stopped counting at six -- roll out upbeat research. Clearly, the consensus calls its current valuation compelling and expects a diversification away from the "one-hit wonder" taint that had investors so worried only a few weeks ago.
 
Michael Jackson and America's Great Recession each expired in June 2009, but last week brought fresh evidence that both the King of Pop and our economy are each officially back from the dead. A surprisingly strong April employment report came hard on the heels of another historic high for the Dow (INDEXDJX:.DJI). Berkshire Hathaway (NYSE:BRK.B) was among several stocks to hit fresh bests, ahead of Omaha's annual "Woodstock for capitalists." The object of their adulation wasn't Jimi Hendrix belting out the "Star-Spangled Banner" on his iconic electric guitar, but a ukulele-strumming octogenarian. Similarities to the 1969 original abounded, however, from groupies to many of the same -- now graying -- ponytailed baby boomers old enough to have also traipsed through Max Yasgur's mud-soaked farm 45 years ago. (Whatever happened to "Never trust anyone over 30″?) Woodstock was billed as "an Aquarian explosion of three days of peace and music," but Warren Buffett, having once dismissed derivatives as "financial weapons of mass destruction," long ago became a convert to the ticking time bombs.
 
Today in economics, April's Institute for Supply Management services index is expected to inch up at 10:00 a.m. EDT. On the earnings front, American International Group (NYSE:AIG), Pfizer (NYSE:PFE), Sysco Corp (NYSE:SYY), and Tyson Foods (NYSE:TSN) are all due to release results.
 
Now let's turn to this morning's new stock coverage, a list that includes an accommodation outfit in addition to King Digital Entertainment.

Adamas Pharmaceuticals (NASDAQ:ADMS): William Blair begins coverage at Outperform.
 
FireEye (NASDAQ:FEYE): Deutsche Bank has a fresh Hold on FEYE. Its price objective is $45.
 
King Digital Entertainment: Oh boy, where to begin? Bank of America Merrill Lynch (Buy and $23 target price), BMO Capital (Outperform and $25), Barclays (Overweight and $23), Deutsche Bank (Buy and $27), JPMorgan (Overweight and $30), and RBC Capital (Outperform and $24) are all gushingly upbeat. Piper Jaffray, which assigns only a Neutral, is a rare cautionary voice amid all the pied pipers.
 
La Quinta Holdings (NYSE:LQ): Credit Suisse (Outperform) and Morgan Stanley (Overweight) are equally upbeat on the hotel stock and assign respective objectives of $20 and $23.
 
pSivida (NASDAQ:PSDV): Shares are begun with a Buy and $6 target at MLV & Co., which anticipates additional upside should Iluvien be approved in the United States.

Also see:

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No positions in stocks mentioned.
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