Spotify initiated, Lowe's 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:
Wolfe Research upgraded Tenet Healthcare (THC) to Outperform from Peer Perform with a $122 price target. The firm sees upside to estimates from the Michigan supplemental Medicaid payment increase in 2024 coupled with the company's deleveraging story.
Barclays upgraded SL Green Realty (SLG) to Equal Weight from Underweight with a price target of $48, up from $35. The company has led the office industry in changing the narrative around post-COVID office demand, but while the continued leasing momentum could propel the stock higher, its balance sheet constraints keep the firm on the sidelines, the firm tells investors in a research note.
BMO Capital upgraded Royal Gold (RGLD) to Outperform from Market Perform with a price target of $158, up from $148. The stock's valuation is now more compelling under BMO's new commodity price assumptions and with the modest relative underperformance of Royal Gold year-to-date versus Franco-Nevada and Wheaton Precious Metals, the firm says.
Jefferies upgraded Nuvation Bio (NUVB) to Buy from Hold with a price target of $10, up from $1.40, following the acquisition of AnHeart Therapeutics for about $300M in stock.
BTIG upgraded Outlook Therapeutics (OTLK) to Buy from Neutral with a $50 price target after increasing the firm's view of the probability of success for ONS-5010 to 90% from 35% and lowering its discount rate.
Top 5 Downgrades:
DA Davidson downgraded Lowe's (LOW) to Neutral from Buy with an unchanged price target of $270, citing valuation. With the stock outperforming year-to-date and Lowe's valuation at the highest it has been since early on during the pandemic, both on an absolute and relative basis, the shares "are due a pause," the firm says.
Keefe Bruyette downgraded Wells Fargo (WFC) to Market Perform from Outperform with a price target of $62, up from $56. The firm cites valuation for the downgrade, saying the shares have had strong run, outperforming peers by 48% since the summer of 2021 due to expense control, buybacks, and an asset-sensitive balance sheet.
Redburn Atlantic downgraded Visa (V) to Neutral from Buy with a $307 price target. The firm says the company's "less mature" value-added service and solution proposition and exposure to debit revenues, where it continues to see a potential threat from digital wallets, leave it more cautious.
Barclays downgraded First Industrial Realty (FR) to Equal Weight from Overweight with a price target of $53, down from $63. Supply growth in Southern California, where First Industrial has 24.4% of its portfolio, is resulting in higher vacancy and pricing pressure, the firm tells investors in a research note.
UBS downgraded Linde (LIN) to Neutral from Buy with a price target of $510, up from $482. The firm believes the combination of slower earnings growth and an "already high" multiple will limit stock appreciation from here.
Top 5 Initiations:
HSBC initiated coverage of Spotify (SPOT) with a Buy rating and $310 price target. The company is the music streaming leader and has new verticals with large opportunities.
Barclays reinstated coverage of JetBlue (JBLU) with an Underweight rating and $6 price target. The company's standalone strategy appears to be returning to its roots in the Northeast, but its significant financial leverage will likely challenge future returns for shareholders, the firm tells investors in a research note.
Barclays reinstated coverage of Spirit Airlines (SAVE) with an Underweight rating and $4 price target. Spirit faces significant operating and financial headwinds in the coming year that are likely to limit share upside, the firm tells investors in a research note.
Raymond James initiated coverage of Yelp (YELP) with a Market Perform rating and no price target. The firm says visibility on the macro environment and Yelp's returns to attract new leads remains low. Raymond also resumed coverage of ZipRecruiter (ZIP) with a Market Perform rating.
Raymond James resumed coverage of Squarespace (SQSP) with an Outperform rating and $40 price target. The firm sees a stable backdrop for web services, where generative artificial intelligence presents more opportunity than risk through embedding creation features. Raymond also resumed coverage of Wix.com (WIX) with an Outperform rating and GoDaddy (GDDY) with a Strong Buy.
