Additionally, BofA upgraded both Wynn Resorts and Las Vegas Sands to Buy
Check out today's top analyst calls from around Wall Street, compiled by The Fly.
UBS BOOSTS MICRON TO BUY: UBS analyst Timothy Arcuri upgraded Micron Technology (MU) to Buy from Neutral with a price target of $75, up from $47. After "only modestly" outperforming the S&P 500 Index over the past two years, the time has "finally come" when Micron can materially outperform over a sustained period of time, Arcuri said. The analyst believes the company is in a much stronger position in a structurally better industry on the cusp of a cyclical upswing that, for DRAM, should last well into 2021. Further, Micron deserves a higher multiple given its improving competitive position and through-cycle financial performance that is comparable to or even better than other major semis peers with integrated manufacturing models like Intel (INTC) or Texas Instruments (TXN), contended Arcuri. For DRAM, he sees a two year runway for under-supply, and for NAND, he sees modestly under-supplied setup in the first half of 2020.
BOFA UPGRADES WYNN RESORTS, LAS VEGAS SANDS: BofA analyst Shaun Kelley upgraded Wynn Resorts (WYNN) and Las Vegas Sands (LVS) to Buy from Neutral. The analyst is also keeping the price target on Wynn at $150 and raising it on Las Vegas Sands to $80 from $72. Kelley cited the declining sequential and daily growth rates of new coronavirus cases in Wuhan/China, as well as the efforts by Beijing to control the spread and the positive recent commentary on the disease from the WHO. The analyst further noted that while the risk of coronavirus casis being under-reported remains, he also believes that the muted response in Macau casino gaming relative to prior corrections reflects the "passing nature of the threat."
PIPER INITIATES BEYOND MEAT AT NEUTRAL: Piper Sandler analyst Michael Lavery initiated coverage of Beyond Meat (BYND) with a Neutral rating and $115 price target. Beyond is an early leader in plant-based meat, which could be a $6B-$8B market by 2025, Lavery noted. The analyst said that while upside from U.S. distribution at McDonald's (MCD) could be a potential catalyst, his analysis suggests the stock's valuation may already reflect this. In his Lavery's survey of over 3,500 U.S. adults, 62% of respondents were not interested in consuming plant-based meat and only 2% prefer Beyond. However, 15% were willing to try the category and 7% have no brand preference, suggesting potential upside for Beyond outside of its existing consumer base, contended the analyst. Further, his channel checks with McDonald's franchisees indicate that U.S. operators have more interest in a new chicken sandwich and are skeptical on meatless burgers.
CREDIT SUISSE RAISES BOEING PRICE TARGET TO $367: Credit Suisse analyst Robert Spingarn raised his price target for Boeing (BA) to $367 from $321 after hosting management for a sell-side lunch. He kept a Neutral rating on the shares. The analyst said that while nothing material was revealed, the perspectives offered by the company on items ranging from free cash flow, to customer penalties, to productivity left him "incrementally more constructive" on the name. Boeing management sees the free cash flow lost from the MAX interruption as largely recoverable, but acknowledged the 787 rate reductions are a headwind versus prior expectations, Spingarn said. Consensus in the room, though not necessarily endorsed by Boeing, was that 2023 could be a "near-normal" cash year, where production/deliveries would normalize while concessions would become largely immaterial, added the analyst. Spingarn's new price target reflects increased confidence in the cash profit trajectory at Boeing and expectations that we are "entering into a positive news period."
PIPER CUTS UNDER ARMOUR TO NEUTRAL: Piper Sandler analyst Erinn Murphy downgraded Under Armour (UAA) to Neutral from Overweight with a price target of $19, down from $27. The analyst said that while she was expecting a lower than expected North America outlook, she did not expect the magnitude of the earnings cut. Murphy is positive on the changes Under Armour is making to clarify its focus as a premium, performance brand. However, she now sees a "timely return" to double digit percentage EBIT margins as less likely within the bounds of its existing five-year plan. Under Armour's margin recovery story has taken a "pause," Murphy told investors in a research note.
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