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Investing.com - Deutsche Bank has reduced its price target on Raspberry Pi Holdings PLC (LON:RPI) to GBP3.80 from GBP4.20 while maintaining a Hold rating on the stock.
The price target adjustment comes as the single-board computer manufacturer faces challenges related to rising DRAM memory costs, particularly for higher-density configurations ranging from 4GB to 16GB.
Deutsche Bank analyst notes that Raspberry Pi is at a crossroads in its business approach, needing to decide whether to increase board pricing to offset higher memory costs or absorb these expenses to maintain customer goodwill.
The research firm believes Raspberry Pi should already be implementing price increases for its single-board computers, similar to industry peers, given the severity of the DDR4 shortage.
Deutsche Bank observes that the company appears hesitant to raise prices due to potential impacts on its loyal customer base and possible complications with its reseller channel, which might require compensation if prices were subsequently reduced.
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