Check out today's top analyst calls from around Wall Street, compiled by The Fly.
MIZUHO UPGRADES SKYWORKS, QORVO: Mizuho analyst Vijay Rakesh upgraded Skyworks Solutions (SWKS) to Buy from Neutral with a price target of $132, up from $90. Rakesh also upgraded Qorvo (QRVO) to Buy from Neutral with a price target of $125, up from $80. The analyst upgraded the radio frequency suppliers as he sees "meaningful upside" from an improving 5G handset outlook. RF content per handset is estimated to rise 50%-60% versus 4G, Rakesh told investors in a research note. The analyst believes share catalysts should come from the 3GSM in mid-February, which he noted should see multiple 5G handset launches, a potential for a Huawei settlement in the second half of 2020 as China trade tensions cool, and multiple new Apple (AAPL) iPhone models including 5G.
DEUTSCHE BANK BOOSTS L BRANDS: Deutsche Bank analyst Tiffany Kanaga upgraded L Brands (LB) to Buy from Hold with a price target of $24, up from $22. The holiday report, with Victoria's Secret reporting sales well below expectations, likely tips the scale "more toward a split, likely triggering strategic action in the near-term," Kanaga wrote in a research note titled "So Bad, It's Good?" The company's "window of opportunity" for action is fairly limited, which creates a risk/reward that is now "skewed meaningfully to the upside," contended the analyst, whose sum-of-the-parts analysis yields a $26 share price. Kanaga expects Victoria's Secret EBIT to inflect negative in 2020 and she feels Bath & Body Works has a "clear path" toward high-single-digit EBIT growth or more in 2020. In addition, Barington's standstill agreement expires in February, while other activists could enter the fray ahead of L Brands' annual meeting, said the analyst.
WELLS DOWNGRADES SIX FLAGS TWICE: Wells Fargo analyst Timothy Conder downgraded Six Flags Entertainment (SIX) to Underweight from Equal Weight with a price target of $38, down from $42. The analyst earlier had downgraded the shares to Equal Weight from Overweight in a separate note to investors. Conder said Six Flags's pre-announcement this morning of "disappointing" Q4 pass and membership trends added to his previous China concerns. The analyst, who again reduced his estimates for the company, sees no near-term upside catalyst and believes investors likely will not give Six Flags any near-term credit until clarity on domestic demand emerges.
Additionally, Janney Montgomery Scott analyst Tyler Batory downgraded Six Flags to Neutral from Buy as he read its disappointing Q4 attendance and softer than expected season pass sales as "clear indicators" that trends in the core business keep deteriorating.
SUSQUEHANNA CUTS FOOT LOCKER TO NEUTRAL: Susquehanna analyst Sam Poser downgraded Foot Locker (FL) to Neutral from Positive with a price target of $41, down from $47. Channel checks indicate that holiday launches from Nike (NKE), Adidas (ADDYY), and others were not enough to overcome last year's difficult comparisons, Poser said. The analyst believes Foot Locker will miss its relatively flat Q4 same-store-sales guidance, but achieve the low end of its low-single-digit fiscal 2019 guidance. Further, any fiscal 2020 guidance in-line or higher than current consensus estimates "will most likely prove too aggressive," contends the analyst. Poser says that despite a "compelling" valuation, less effective engagement and communication is driving lackluster results at Foot Locker. Execution and communication issues may prevent the company from achieving its five-year plan, the analyst contends.
PIPER BOOSTS TESLA PRICE TARGET TO $553: Piper Sandler analyst Alexander Potter raised his price target for Tesla (TSLA) to $553 from $423 after analyzing the company's potential in China. If Tesla's Model 3 market share in the United States can be replicated in China, and if this logic extends also to Model Y, then Tesla's annual volume in China alone would eventually exceed 650,000 units, Potter said. The analyst added that while he's not sure Tesla can immediately replicate its U.S. success in China due to the strength of German brands in China, he's increasing his estimates nonetheless. He now expects China deliveries of 112,000 in 2020, 225,000 in 2021, and 399,000 in 2022. Potter kept an Overweight rating on Tesla shares.
Keywords: analyst, analyst calls, upgrades, downgrades, initiations, research, wall street