Additionally, Uber was initiated with an Overweight rating at JPMorgan
Check out today's top analyst calls from around Wall Street, compiled by The Fly.
PIPER BOOSTS ALTRIA TO OVERWEIGHT: On Thursday night, Piper Sandler analyst Michael Lavery upgraded Altria Group (MO) to Overweight from Neutral with a price target of $57, up from $52. Altria no longer expects Juul equity income contribution through 2022, as it now plans to apply fair value accounting, Lavery noted. Removing these contributions trims 5c from the analyst's 2021 earnings estimate, but he added that there is now no downside risk to earnings from Juul. Altria can re-focus on its core business, where it looks well positioned for sustainable pricing-driven EBIT growth, contended Lavery. He believes iQOS can drive gross margin accretion and share gains over the medium and long-term and that e Altria can deliver 6% average earnings growth through 2021.
GUGGENHEIM RAISES PAYPAL TO BUY: Guggenheim analyst Jeff Cantwell upgraded PayPal (PYPL) to Buy from Neutral with a $133 price target, stating that the "rather muted" reaction to the company's Q4 results and updated outlook has created an opportunity for investors. He sees the Honey acquisition as a significant positive, as it adds Honey's 17M monthly average users to the PayPal ecosystem and moves PayPal up the consumer purchase funnel and expands its value proposition "beyond payments." He also sees a strengthening outlook in PayPal's underlying core business, Cantwell said.
BAIRD CUTS AMGEN TO UNDERPERFORM: Baird analyst Brian Skorney downgraded Amgen (AMGN) to Underperform from Neutral with a price target of $185, up from $173. Amgen is a "great company and the strong execution in the face of some serious headwinds has been more than reflected in the stock," Skorney wrote in a post-earnings research note. He believes the stock's "current premium reflects a level of enthusiasm that just isn't warranted" given the company's stage of maturity. Skorney believes the "exuberance is overdone" and is calling for a pullback in Amgen shares.
JPMORGAN STARTS UBER AT OVERWEIGHT: JPMorgan analyst Doug Anmuth initiated coverage of Uber Technologies (UBER) with an Overweight rating and $51 price target. Uber occupies a leadership position in Rideshare and Food delivery in most parts of the world and has rapidly increased its gross bookings from $34B in 2017 to an estimated $65B in 2019, Anmuth noted. He expects upside in Uber shares to be driven by continued U.S. Rideshare rationalization as well as stability in international rideshare markets, product focus as Uber rolls out loyalty products, the steps being taken to achieve 2021 profitability and its investments in autonomous and other offerings. Anmuth sees 39% upside potential from current share levels.
JPMORGAN UPGRADES ARENA PHARMA TO OVERWEIGHT: JPMorgan analyst Jessica Fye upgraded Arena Pharmaceuticals (ARNA) to Overweight from Neutral with an unchanged price target of $58. The company's "catalyst rich" 2020-2021 coupled with recent share pullback sets up an attractive entry point, Fye said. The analyst expects Arena's primary near-term focus to be fully enrolling the etrasimod pivotal U.S. trials, and in the meantime she sees an "interesting risk-reward" for the second half of 2020 readouts of ADVISE and CAPTIVATE, for which she believes little credit is being given at current share levels.
WWE DOWNGRADED AFTER MANAGEMENT CHANGE: Morgan Stanley analyst Benjamin Swinburne downgraded WWE (WWE) to Equal Weight from Overweight with a price target of $54, down from $80, stating that the "sudden and fairly unexplained" removal of senior management has materially reduced visibility and creates enough uncertainty in the future of the business that he can no longer support a higher rating on the stock.
Loop Capital analyst Alan Gould also downgraded WWE to Hold from Buy with a price target of $50, down from $80, after the company announced the departure of its co-Presidents and lowered its financial outlook. The analyst notes that after the management changes, his confidence level is reduced while he awaits more evidence of WWE's successful renegotiation of its international contracts.
MORE THAN 15 FIRMS RAISE AMAZON'S PRICE TARGET: Following Amazon's (AMZN) Q4 earnings report, where the company beat on the top and bottom lines, and gave Q1 guidance, many Wall Street firms raised their price targets on Amazon shares.
RBC Capital analyst Mark Mahaney raised his price target on Amazon.com to $2,700 from $2,500 and kept his Outperform rating after its "unusually" strong Q4, with revenue and operating income topping his expectations for the first time since Q1 of 2018. The analyst noted that the company's AWS growth and margins were modestly above consensus while its ad revenue growth was "very strong", even though its organic revenue growth decelerated to 21% due to tough international comps and operating margin contracted 80bps from last year to 4.4%.
Goldman Sachs analyst Heath Terry raised his price target for Amazon.com to $2,600 from $2,200 following the Q4 results and kept a Conviction Buy rating on the shares. Amazon reported Q4 revenue above consensus forecasts, with the company exceeding the high-end of its revenue guidance for the first time since Q1 of 2018, Terry noted. He believes the expected acceleration in revenue growth driven by the company's investments in fulfillment and infrastructure, and the associated high returns, are likely to drive "significant" share price outperformance as Amazon "catches up to other large cap technology names."
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