Palantir downgraded, CyberArk initiated: 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:
Raymond James double upgraded Public Storage (PSA) to Strong Buy from Market Perform with a $330 price target. The firm believes the company's recent revenue growth outperformance can be sustained versus peers due to more rent upside after less-aggressive rate increases over the past several years.
Evercore ISI upgraded Kimberly-Clark (KMB) to Outperform from In Line with a price target of $150, up from $133. The firm says that with the shares trading one standard deviation below their 20-year average versus Staples, the stock should work, even if only as a "regression-to-the-mean" investment strategy.
HSBC upgraded U.S. Bancorp (USB) to Buy from Hold with a price target of $53, up from $47. U.S. Bancorp, along with the other super-regional banks, has materially underperformed universal banks and the market year-to-date, which has led to a buying opportunity, the firm says.
HSBC upgraded PNC Financial (PNC) to Hold from Reduce with a price target of $155, up from $141. The firm sees a more attractive relative valuation after the stock's year-to-date underperformance and the incorporation of a higher long-term return on equity into the firm's valuation framework.
HSBC upgraded Allstate (ALL) to Buy from Hold with a price target of $190, up from $158. The firm says rate increases continue to compound across personal auto and homeowners insurance in the U.S. Decelerating inflationary trends put U.S. personal lines insurers "in a sweet spot."
Top 5 Downgrades:
Monness Crespi downgraded Palantir Technologies (PLTR) to Sell from Neutral with a $20 price target. The shares trade at an "egregiously rich valuation" due to the "unprecedented generative AI hype cycle," the firm notes.
BofA downgraded Molina Healthcare (MOH) to Underperform from Neutral with a $439 price target. The firm, which is concerned that Molina and the Medicaid industry more broadly are likely to face rate pressure after a period of elevated margins, sees a less attractive risk/reward for Molina compared to other insurers it covers.
HSBC downgraded Bank of America (BAC) to Hold from Buy with a price target of $39, up from $38. While there is a lot to like about Bank of America, its shares have risen 37% in the past six months, leaving limited implied upside potential, the firm tells investors in a research note.
Raymond James downgraded Extra Space Storage (EXR) to Outperform from Strong Buy with an unchanged price target of $160. The firm remains constructive on the shares but says the $100M Life Storage merger synergies, while still achievable, will take longer to fully realize as the overall self-storage market has softened. Extra Space is now a heavy overweight name among the group," which does present some risks if fundamentals disappoint."
BofA downgraded Galapagos (GLPG) to Underperform from Neutral with a price target of $31, down from $41. The firm is concerned that the stock "remains a value trap."
Top 5 Initiations:
BTIG initiated coverage of CyberArk (CYBR) with a Buy rating and $317 price target. Following field checks with customers, partners, and industry analysts, the firm sees multiple factors driving continued growth in the privilege account management market, where it notes CyberArk holds "a strong leadership position" and is gaining share.
DA Davidson initiated coverage of Progress Software (PRGS) with a Buy rating and $65 price target. Progress has "maintained relevancy over decades with its deep-rooted and uniquely profitable application development platform," OpenEdge, while the company has been successful recently executing its M&A strategy, the firm notes.
Piper Sandler initiated coverage of TransMedics (TMDX) with an Overweight rating and $95 price target. The firm believes the company is changing the organ transplant market with proprietary organ preservation technologies and wholly-owned transport services.
Truist initiated coverage of Merus (MRUS) with a Buy rating and $69 price target. The firm expects petosemtamab to be "highly effective" in combination with immunotherapy in the frontline setting for head and neck cancer.
William Blair initiated coverage of Solid Biosciences (SLDB) with an Outperform rating and $40 fair value estimate. The firm believes the company is entering a period in which it will be a "fast follower" in Duchenne muscular dystrophy.
