Check out today's top analyst calls from around Wall Street, compiled by The Fly.
DEUTSCHE BANK UPGRADES NETFLIX, WESTERN DIGITAL: Deutsche Bank analyst Bryan Kraft upgraded Netflix (NFLX) to Buy from Hold and raised his price target for the shares to $400 from $360. Consensus subscriber expectations for both 2019 and 2020 now seem conservative, Kraft tells investors in a research note. Further, Netflix shares have "de-rated enough," which makes the risk/reward profile attractive, adds the analyst. He sees the company's growth in revenue taking the stock to $400 over the next 12 months as the valuation shifts from 2019 to 2020 estimates. Netflix is winning the battle for talent and "looking more and more like a platform every day, rather than just an application," according to Kraft.
Deutsche Bank analyst Sidney Ho upgraded Western Digital (WDC) to Buy from Hold and raised his price target for the shares to $60 from $45. The analyst is starting to see favorable data points in both hard disk drive and NAND that will support a "solid" second half of the year recovery for Western Digital's earnings. While the company's near-term earnings have downside risk due to weaker than expected NAND pricing, supply cuts across the NAND industry, along with a reacceleration of HDD demand, will likely lead to a stronger recovery off a lower base in the first half of 2019, Ho told investors in a research note. He expects management to highlight improved visibility on the upcoming earnings call, which he believes will be a positive catalyst for the shares. As such, Ho sees a favorable for Western Digital into the earnings print.
DA DAVIDSON BOOSTS E.L.F. BEAUTY TO BUY: DA Davidson analyst Linda Bolton Weiser upgraded e.l.f. Beauty (ELF) to Buy from Hold and raised her price target to $15 from $7. The analyst cites the findings of her proprietary store checks suggesting that the company products have seen a 17% increase in shelf space at Target (TGT), overtaking Coty's (COTY) Covergirl brand, while its Q1 sales "inflected from down high-single digits" in Q4 to low-single digits. Weiser believes that her FY20 sales forecast of a 2% decline may be conservative based on these findings.
GOLDMAN CUTS HOLLYFRONTIER TO SELL: Goldman Sachs analyst Neil Mehta downgraded HollyFrontier (HFC) to Sell from Neutral and lowered his price target for the shares to $45 from $53. The analyst now sees a less attractive crude differential environment given a narrower Brent-WTI and WTI-WCS spread forecast in 2019 and 2020. Further, he has continued concerns around HollyFrontier's specialties business amid base oil oversupply and notes the company's recent operational execution has been below expectations. Mehta sees 5% total return downside.
NOMURA STARTS MICRON AT NEUTRAL: Nomura Instinet analyst David Wong started Micron Technology (MU) with a Neutral rating and $45 price target. The analyst expects continuing pressure on memory profitability through 2019 as the semiconductor industry works through the downturn that began in late 2018. However, he sees Micron's margins bottoming in the August quarter and thinks structural improvements in the memory industry should allow the company to maintain profitability levels going forward that are similar to what we have seen in the last four years.
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