Bluebird Bio downgrades and Roku price target increase also among notable calls
Check out today's top analyst calls from around Wall Street, compiled by The Fly.
MOVING TO THE SIDELINES: Argus analyst Kristina Ruggeri downgraded Under Armour (UAA) to Hold from Buy. The company has been hurt during the pandemic by the restrictions on high school, college, and other team sports, having posted a fiscal year 2020 loss and still continuing to restructure its operations, the analyst told investors in a research note. Ruggeri added that while Under Armour is making progress in lowering costs and should return to profitability this year, its management still expects 2021 earnings to be below 2019 levels. The analyst believes the company will need time to overcome its current challenges.
FAVORITE INTERNET STOCK: Citi analyst Jason Bazinet raised the firm's price target on Amazon.com (AMZN) to $3,750 from $3,600, while keeping a Buy rating on the shares. Further, the analyst called Amazon his favorite internet stock. Though he fears the Street's digital advertising forecasts, including Amazon's, are too high, Bazinet believes Amazon "has eight other positive attributes" that keep him bullish. These include U.S. e-commerce penetration rates being just 20%, "leaving ample room for growth," and Amazon maintaining share within the market.
'TOO MANY QUESTIONS': JPMorgan analyst Cory Kasimov downgraded Bluebird Bio (BLUE) to Neutral from Overweight with a price target of $39, down from $76. The announcement of acute myeloid leukemia/myelodysplastic syndrome cases in two patients treated with LentiGlobin is an "unwelcomed development - the second in four months," Kasimov told investors in a research note. The analyst believes the news calls into question the value proposition of this "one-time transformative treatment," represents "another big hit to the already depressed sentiment" around Bluebird, and may have broader implications for the gene therapy field. "There are simply too many questions around it for us to not be on the sidelines," Kasimov added.
Meanwhile, RBC Capital analyst Luca Issi also downgraded Bluebird Bio to Sector Perform from Outperform with a price target of $37, down from $93. The analyst cited the company's temporary suspension of sickle cell disease/B-thal programs due to two severe adverse events, and said he believes the programs' future is uncertain. Issi added that it will be difficult to definitively pinpoint the underlying cause of these cases, and with impending oncology-business split, "little remains" to drive value for Bluebird Bio shares.
MULTIPLE TAILWINDS: Morgan Stanley analyst Benjamin Swinburne raised the firm's price target on Roku (ROKU) to $275 from $200, saying he believes the company continues to execute well and that fourth quarter revenues should benefit from multiple tailwinds as Roku remains "at the center of the global transition to streaming." However, he kept an Underweight rating on the shares citing the stock's current valuation. Swinburne continues to see the majority of the earnings generated from streaming globally to be earned by publishers like Netflix (NFLX), Disney (DIS), Amazon Prime, Google's (GOOGL) YouTube, and others.
UPSIDE FROM EV PENETRATION: Citi analyst Amanda Scarnati upgraded Cree (CREE) to Buy from Neutral with a price target of $160, up from $105. The stock over the next 12 months will positively react to any governmental or industry news regarding increases to electric vehicle penetration or restriction on emissions on internal combustion engines, Scarnati told investors in a research note. The analyst believes that during President Biden's first State of the Union he will highlight his plan to invest $400B in clean energy, which includes improving battery technologies, restoring the tax credit for vehicles, and installing a national network of chargers. Scarnati views this as a positive for Cree.
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