Boeing downgraded, Target upgraded: 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:
Morgan Stanley upgraded Target (TGT) to Overweight from Equal Weight with a price target of $165, up from $140. Lower interest rates, bottoming durables and a late 2024 housing inflection make for an improving setup, the firm tells investors in a research note. Morgan Stanley also upgraded Starbucks (SBUX), Wayfair (W) and Dollar General (DG) to Overweight from Equal Weight.
Piper Sandler upgraded Home Depot (HD) to Overweight from Neutral with a price target of $400, up from $311. The firm now thinks Home Depot is set to outperform both the market and Lowe's (LOW).
Gordon Haskett upgraded Domino's Pizza (DPZ) to Buy from Hold with a $467 price target. The firm views the shares as "compelling" given concept-specific market share drivers that could make current Street 2024 same-store sales growth estimates "conservative." Gordon Haskett also upgraded Brinker (EAT) to Buy from Hold with a $48 price target.
Barclays upgraded Western Digital (WDC) to Overweight from Equal Weight with a price target of $65, up from $45, citing better fundamentals in HDD and flash. Deutsche Bank also upgraded Western Digital to Buy from Hold with a price target of $65, up from $45.
Bernstein upgraded Boston Beer (SAM) to Market Perform from Underperform with a price target of $335, up from $280. Boston Beer is now a Twisted Tea story and Truly is showing some signs of improvement, the firm tells investors in a research note.
Top 5 Downgrades:
Wells Fargo downgraded Boeing (BA) to Equal Weight from Overweight with a price target of $225, down from $280. With the FAA taking a closer look into Boeing's production, the risk of a delivery impact increases significantly, the firm tells investors in a research note.
Craig-Hallum downgraded Five Below (FIVE) to Hold from Buy with a price target of $195, down from $220. While the firm continues to view Five Below as a "premier growth story within the retail sector," it sees FY24 as set up to be a "below trend growth year," with the company projecting new units below consensus forecasts while presenting at ICR.
Mizuho downgraded PayPal (PYPL) to Neutral from Buy with a price target of $65, down from $72. The firm's data suggests that market share loss for PayPal to Apple (AAPL) Pay looks increasingly challenging.
Gordon Haskett downgraded Starbucks (SBUX) to Hold from Buy with a $100 price target. The firm is moving to the sidelines given what it sees as diminished upside and upward revision prospects. Gordon Haskett also downgraded Wendy's (WEN) to Hold from Buy with a $21 price target.
Morgan Stanley downgraded Brinker (EAT) to Underweight from Equal Weight with an unchanged price target of $36. The firm doesn't find the risk-reward skew as attractive right now with patience still required for the turnaround story to play out. Morgan Stanley also downgraded Tractor Supply (TSCO) to Underweight from Equal Weight with an unchanged price target of $195.
Top 5 Initiations:
BMO Capital initiated coverage of Datadog (DDOG) with an Outperform rating and $140 price target. The firm is positive on the underlying fundamentals of the observability sector, and believes Datadog and Dynatrace (DT) will consolidate spend as the category expands.
Canaccord initiated coverage of Enphase Energy (ENPH) with a Buy rating and $142 price target. The firm views Enphase as better equipped than Solaredge Technologies (SEDG) to benefit from a demand recovery in the near-term due to its use of contract manufacturers and existing production lines in the U.S. In addition, its modular, scalable microinverter products can be paired with any number of panels. Canaccord also initiated coverage of SolarEdge with a Hold rating and $80 price target.
UBS initiated coverage of Steel Dynamics (STLD) with a Neutral rating and $120 price target. The firm sees Fabrication margins trending lower across 2024 and sees U.S. flat rolled prices near a peak after a major restock move over the past several months.
Goldman Sachs initiated coverage of Nextracker (NXT) with a Buy rating and $62 price target, representing roughly 50% upside. The firm expects the company to benefit from the volume tailwind from the Inflation Reduction Act as well as the 45X tax credits, which it says could represent significant upside to earnings estimates.
Northland initiated coverage of Navitas Semiconductor (NVTS) with a Market Perform rating and no price target. The firm is "sidelined by valuation" and argues that the multiple paid in Renesas' recent deal to purchase Transphorm (TGAN) suggests that Navitas is fairly valued.
