Adobe upgraded, DigitalOcean double downgraded: Wall Street's top analyst calls
The most talked about and market moving research calls around Wall Street are now in one place. Here are today's research calls that investors need to know, as compiled by The Fly.
Top 5 Upgrades:
Mizuho upgraded Adobe (ADBE) to Buy from Neutral with a price target of $630, up from $520, ahead of the company's fiscal Q3 report next Thursday. Enterprise checks were "generally healthy" and indicative of a "much better" fiscal Q4 for Adobe, the analyst tells investors in a research note.
BofA upgraded Gilead (GILD) to Buy from Neutral with a price target of $95, up from $88, given the belief that Gilead's accelerating growth and expanding pipeline is "underappreciated by investors."
Deutsche Bank upgraded First Solar (FSLR) to Buy from Hold with a price target of $235, up from $220. The company delivered a strong growth message over the next three years at its analyst day, the analyst tells investors in a research note.
Wells Fargo upgraded TC Energy (TRP) to Equal Weight from Underweight with an unchanged price target of C$47. The company is "nearing the finish line" on asset sales and could fix its balance sheet with one more sizable deal, Wells says.
Erste Group upgraded ConocoPhillips (COP) to Buy from Hold. ConocoPhillips is benefiting from robust demand for its products and plans to slightly increase production volumes in 2023, notes the firm, which adds that oil prices should rise slightly and consensus sales and earnings forecasts will "soon be revised upwards."
Top 5 Downgrades:
BofA double downgraded DigitalOcean (DOCN) to Underperform from Buy with a price target of $25, down from $47. Data from the firm's analytics team shows that traffic to the DigitalOcean domain has "materially slowed down" since the beginning of the year.
Citi downgraded Essex Property Trust (ESS) to Neutral from Buy with a price target of $260, down from $280. With Essex having "returned to a premium valuation," the upside and downside risks seem balanced following the stock's outperformance versus apartments and the broad REIT sector year-to-date, the analyst tells investors.
Deutsche Bank downgraded ABM (ABM) to Hold from Buy with a price target of $43, down from $65. Deutsche Bank says the company's results and fiscal 2024 guidance were disappointing as management indicated it expected to see a continued negative impact from a soft commercial real estate market next year, continued project delays in Technical Solutions and a potential of lost business in the manufacturing and distribution segment from a large customer.
BofA downgraded Vir Biotechnology (VIR) to Neutral from Buy with a price target of $14, down from $23. Vir shares are down 54% year-to-date, largely based on "underwhelming data" in both influenza A and HBV, the analyst tells investors.
Erste Group downgraded Nike (NKE) to Hold from Buy. The analyst says consumer sentiment has "deteriorated significantly," particularly in Nike's important sales market of China.
Top 5 Initiations:
RBC Capital initiated coverage of Lucid Group (LCID) with a Sector Perform rating and $6 price target. Lucid's technology is better than its nearest competitor Tesla (TSLA) based on an apples to apples comparison of efficiency and work by Munro & Associates, the analyst tells investors in a research note.
DA Davidson initiated coverage of Snowflake (SNOW) with a Buy rating and $200 price target, stating the company has long been the industry-leading cloud data warehouse provider, and has expanded into products that capture additional workloads, particularly in the machine learning space.
William Blair initiated coverage of Procter & Gamble (PG) with a Market Perform rating. With a 2024 enterprise-value-to-EBITDA multiple of about 17.5 times, above the historical mean of 16.5, the shares are likely to perform more in line with, rather than materially ahead of, the market, the analyst tells investors in a research note.
Piper Sandler initiated coverage of Surf Air Mobility (SRFM) with an Overweight rating and $4 price target, implying more than two-times upside potential versus the current price. The analyst says Surf Air has been overlooked due to the timing of its direct listing, which coincided with earnings season and summer vacations.
Goldman Sachs initiated coverage of Axis Capital (AXS) with a Sell rating and $51 price target. The pivoting of the company's business will be a slower than anticipated process and the scaling back on property reinsurance lines will have greater than expected implications for growth in casualty reinsurance and potentially margins as well, the analyst tells investors in a research note.
