4 big analyst cuts: JPMorgan strips Brunswick of Overweight rating
Investing.com -- Here is your Pro Recap of the biggest analyst cuts you may have missed since Friday: downgrades at Brunswick, DigitalOcean, Summit Materials, and Evergy.
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Brunswick stock falls on JPMorgan downgrade
Brunswick (NYSE:BC) shares were down some 1.8% recently after JPMorgan downgraded the company to Neutral from Overweight and cut its price target to $79.00 from $109.00, as reported in real-time on InvestingPro.
The firm expressed caution about the maker of recreational boats and marine parts due to two key short-term uncertainties. First, they highlighted concerns about high interest rates affecting consumer demand and the potential for a continued economic downturn in the near term.
Second, they argue that there is excess inventory among dealers, which may result in production slowdowns for new boat units over the next year to balance the supply chain. The analysts added:
We ultimately see BC’s business achieving Flat to Low-Single-Digit growth over the next 2 years on relatively Flat margins, with FCF conversation below management’s historical ~75% target.
Shares of Brunswick were recently trading hands at $75.03.
DigitalOcean slashed to Underperform
BofA Securities late last week cut DigitalOcean (NYSE:DOCN) to Underperform from Buy and slashed its price target to $25.00 from $47.00, stating that the company's fundamentals remain weak, and the transition of its CEO is concerning.
The analysts explained that data from their analytics team indicates a significant decline in traffic to the DigitalOcean domain since the start of the year. This has led them to anticipate worsening customer growth, average revenue per user (ARPU), and churn metrics in the short term.
Two more downgrades
Wolfe Research on Monday downgraded Evergy (NASDAQ:EVRG) to Peerperform from Outperform. Shares were recently off 1.8% to $52.98.
Summit Materials (NYSE:SUM) shares dropped more than 3% on Friday after Wolfe Research downgraded the company to Peerperform from Outperform. The analysts elaborated:
The announced takeover of cement-focused Argos USA faces rising interest rates and concerns over the U.S. construction cycle, prompting our downgrade to Peer Perform.
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