Additionally, RBC upped its target on Nvidia to $301
Check out today's top analyst calls from around Wall Street, compiled by The Fly.
ANALYSTS TAKE OPPOSITE SIDES ON CANADA GOOSE: Baird analyst Jonathan Komp upgraded Canada Goose (GOOS) to Outperform from Neutral with an unchanged price target of C$53. Komp is encouraged that Canada Goose shares fell only modestly after the company cut earnings estimates greater than 20% on the coronavirus impact. Getting past the estimate reset is an important step, says the analyst, who sees "potential for the intensity surrounding several debates" to lessen during fiscal 2021. He believes the shares "could double" if Canada Goose returns to its longer-term algorithm and recaptures lost China/Hong Kong contribution.
Meanwhile, Goldman Sachs analyst Alexandra Walvis downgraded Canada Goose to Neutral from Buy with a price target of $34, down from $44. The company reported Q3 results that were in line with "muted" expectations, but its guidance was cut to account for expected coronavirus disruption to Chinese consumer spending, Walvis noted. While the analyst assumes the potential impact on Canada Goose of coronavirus will be temporary, she sees "incremental causes for concern at the business."
Similarly, Cowen analyst Oliver Chen downgraded Canada Goose to Market Perform from Outperform. He cited a lack of evident revenue and gross margin upside amid evolving coronavirus risks. He said his analysis suggests a tourism-related traffic slowdown, but added that the brand strength remains robust and it could be a takeout target.
UBS UPGRADES FEDEX TO BUY: UBS analyst Thomas Wadewitz upgraded FedEx (FDX) to Buy from Neutral with a price target of $181, up from $167. The analyst notes that his favorable view for the stock is supported by low expectations for its earnings as well as the company's "visible" efforts to improve the B2C cost structure of its Express business, even though the visibility on the timing of its margin improvement remains "somewhat limited". Wadewitz adds that FedEx has "multiple potential levers" to drive margin expansion in Express, with an added "backdrop of likely stabilization" in the company's Ground business margins seen in FY21.
WWE DOUBLE DOWNGRADED BY WELLS ON 'MISFIRES': Wells Fargo analyst Steven Cahall double downgraded WWE (WWE) to Underweight from Overweight with a price target of $36, down from $80. "There have been too many misfires at WWE for investors to take interest in the near future," Cahall tells investors in a research note. To get "back on its feet," WWE needs rights agreements in India and the Middle East as well as new CFO, contends the analyst. Further, he believes the company's elevated investment spending needs to be better explained and that long-term guidance needs to be provided.
On Friday, after the company's second quarter revenue fell well below analysts' estimates and the sport-entertainment company said it is exploring alternatives for its WWE Network, Wolfe Research analyst Eric Katz downgraded WWE to Peer Perform from Outperform with a price target of $45, down from $97.
INTELSAT GETS ANOTHER DOWNGRADE AFTER C-BAND PLAN: Raymond James analyst Richard Prentiss downgraded Intelsat (I) to Market Perform from Outperform after the FCC issued details Friday of the C-Band Draft Order. Prentiss tells investors that while Intelsat will not receive as significant a windfall as some had hoped for, he thinks $4.852B of ARP will allow Intelsat to continue addressing its over $14B of net debt and improve leverage, while allowing management to shift focus to operational and industry structure issues.However, given the headwinds of the fundamental business, the loss of the I-29e satellite, and being highly levered, the analyst feels the risk/reward for Intelsat shares is more fairly valued.
On Friday, JPMorgan analyst Philip Cusick downgraded Intelsat to Underweight from Neutral without a price target. Cusick said he sees little to no fundamental equity value in the shares given the details of Federal Communications Commission Chairman Ajit Pai's C-Band proposal.
COWEN SEES MORE FAVORABLE NEAR-TERM SET-UP FOR TARGET THAN WALMART: While Target (TGT) and Walmart (WMT) are Cowen's top two ideas in Retailing, the near-term risk/reward appears more favorable for Target as both companies head into their respective Q4 reports and investor days, analyst Oliver Chen tells investors in a research note. The analyst senses that investors are looking for Walmart's investor day to focus on digital profitability and for management to lay out a path toward more profitable growth. If commentary underwhelms, the shares may be pressured in the near-term, contends Chen.
RBC UPS NVIDIA TARGET TO $301 AHEAD OF EARNINGS: RBC Capital analyst Mitch Steves raised his price target for Nvidia to $301 from $251 and keeps an Outperform rating on the shares. The analyst's channel checks suggest both gaming and data center demand came in better than expected in the company's January quarter, particularly when compared to Street estimates. Steves says that assuming Nvidia hits his new increased estimates, the company would have a revenue run-rate similar to October of 2018 while the stock is $50 below its $300 peak. Further, Nvidia's operating margins will improve to 40%-plus by the middle of 2020, Steves writes in a pre-earnings research note. He expects the company's January quarter will come in a "bit ahead" of the high-end of its guidance due to better than expected gaming and data center demand. That said, the analyst does not see a change to seasonal patterns for April due to macro concerns.
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