Rivian ripe for the picking after last week's plunge: 5 big analyst picks
Investing.com -- Here is your Pro Recap of the biggest analyst picks you may have missed since yesterday: an Outperform initiation at AutoZone, and upgrades at Oracle, Rivian Automotive , and Exact Sciences.
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Rivian upped to Buy at UBS after long fall
UBS upgraded EV maker Rivian Automotive (NASDAQ:RIVN) to Buy from Neutral, although with a slightly lower price target of $24 (from the prior $26), as reported in real time on InvestingPro.
The analysts say they see an "improved set-up" for the stock after a 20% plunge from last week on a $1.5 billion green convertible note issue. They say that, with that capital raise out of the way, "the market can refocus on improving fundamentals."
They also believe the company won't have further need for a capital raise until the end of 2025.
Shares were jumping 4.8% to $19.68 in recent trading.
EA upgraded to Buy at BofA on 'unwarranted' discount
BofA upgraded Electronic Arts (NASDAQ:EA) to Buy from Neutral, bumping its price target by $5 to $150.
The analysts said that after a tough period for the company, the balance of risk again looks appealing because of a five-year trough in relative valuation, as well as early stats suggesting that the "EA SPORTS FC" rebranding (from the prior FIFA) may result in upside to current Street estimates and guidance.
They also believe "FY25 and out year estimates could see a string of upward revisions as EA benefits from above trend growth in the PC/Console game market in CY24 and beyond."
Shares were recently adding 3% to $128.35.
AutoZone started with Outperform at TD Cowen
TD Cowen initiated coverage on AutoZone (NYSE:AZO) with an Outperform rating and a price target of $2,975.00.
"We are constructive on AZO’s catalysts which should support strong revenue growth," wrote the analyst, adding that they project revenue rising at a compound annual growth rate of 7.7% between FY23-FY27, "which is +140bps above trends in the decade prior to the pandemic."
The analysts expect that growth to be driven by the rebound of their commercial "do-it-for-me" (DIFM) business; stable +1-2% comparable-store sales for its "do-it-yourself" (DIY) business; a lift from accelerating international openings; and the ongoing expansion of their so-called mega hubs (facilities that are a mix of retail and distribution and support nearby locations)
TD Cowen is also bullish on initiatives to improve delivery speed, "which we think will be a major long-term unlock," the analysts wrote.
Shares were lately up 0.6% to $2,581.36.
EXACT Sciences gets Overweight rating at Piper
EXACT Sciences (NASDAQ:EXAS) shares were up more than 3% Tuesday after Piper Sandler upgraded the early-stage-cancer-detection company to Overweight from Neutral with a price target of $90, some 40% higher than Monday's close.
Piper highlighted the robust year-over-year growth of Cologuard, the company's at-home colon cancer screening test, estimated at 29% for all of 2023. Overall it foresees EXACT's annual revenue exceeding 10% growth for at least the next five years.
The analysts also believe the stock's 36% slide from its July peak is a compelling entry point, and that there could be upside to even their own EBITDA estimates of $518 million in 2025E.
They also wrote the company will likely "be only lightly impacted by macroeconomic factors," or by such regulatory factors as the Food and Drug Administration's rules around laboratory-developed tests (LDTs).
Shares were recently climbing 3.2% to $66.49.
Oracle upgraded to Outperform
Evercore ISI upgraded Oracle (NYSE:ORCL) to Outperform from In Line on Monday and raised its price target by $4 to $135.
Evercore sees the recent stock pullback as an attractive entry point given Oracle's improved position for delivering more consistent revenue and earnings growth, primarily driven by higher revenue from its cloud solutions. The analysts believe the apps and infrastructure cloud businesses are contributing significantly to revenue, and that they are expected to drive future high single-digit total revenue growth.
The firm also said Oracle Cloud Infrastructure (OCI) represents a potential long-term growth opportunity, with estimated growth rates (50% CAGR from fiscal 2023-2026) that could prove conservative.
They believe the macroeconomic environment is favorable to integrated software suites, which they say should support steady growth in Oracle's applications segment and potentially drive database/OCI revenue as legacy customers transition to the cloud.
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