Oracle upgrade at Barclays also among today's top calls
Check out today's top analyst calls from around Wall Street, compiled by The Fly.
BOEING UP TO BUY: Canaccord analyst Ken Herbert upgraded Boeing (BA) to Buy from Hold with a price target of $275, up from $200. The combination of a recovery in passenger travel, higher fuel prices and improved financial health at the airlines should support the delivery plans for the returning 737 MAX, Herbert tells investors. The analyst, who expects significantly improved free cash flow in 2021 and positive cash generation in 2022 from Boeing, sees further upside for the stock even after the significant move up off its March 2020 lows, he added. NIKOLA CUT TO NEUTRAL: JPMorgan analyst Paul Coster downgraded Nikola (NKLA) to Neutral from Overweight with a price target of $30, down from $33. Following the Q4 report, which provided investors reassurance that the company is "more focused," much of "good news is now priced in the stock," Coster tells investors in a research note. The analyst believes the story "should heat up again" in to mid- to late-2021 if customer orders get announced and as the first fuel cell electric vehicle prototype "comes to life." Coster calls the downgrade a "tactical call" based on the timing of catalysts.
Meanwhile, Coster lowered the firm's price target on Bloom Energy (BE) to $36 from $38 and keeps a Neutral rating on the shares. The JPMorgan Renewables Index is down 22% in one month, correction territory for alternative energy, and this will have a "lingering effect on multiples, particularly the more speculative hydrogen pure-play stocks," Coster tells investors in a research note. However, "risk aversion" causes the analyst to be "incrementally constructive" on Bloom Energy. The company has more scale and is in closer proximity to profitable growth, says Coster. The analyst now prefers Bloom to Nikola.
ORACLE UPGRADED AT BARCLAYS: Barclays analyst Raimo Lenschow upgraded Oracle (ORCL) to Overweight from Equal Weight with a price target of $80, up from $66. The analyst sees accelerating growth for Oracle, which he believes will drive multiple expansion. The two factors for the better growth are an improving cloud mix and a better IT spend environment, Lenschow tells investors in a research note. Oracle "has been ignored by investors for a while," but its "good" cloud products are now big enough to offset the headwinds from the "dwindling products," says Lenschow.
INTERACTIVE BROKERS INITIATED: Jefferies analyst Daniel Fannon initiated coverage of Interactive Brokers (IBKR) with a Buy rating and $89 price target. Elevated retail activity and the potential for higher interest rates both represent earnings tailwinds for Interactive Brokers, which Fannon calls "the only true low cost, global full service brokerage offering" for active investors.
SMITH & WESSON CUT TO HOLD: Craig-Hallum analyst Steve Dyer downgraded Smith & Wesson Brands (SWBI) to Hold from Buy with a price target of $17, down from $19. Dyer thinks shares will continue to be rangebound as investment sentiment is fading, gun stocks typically peak before earnings do, and difficult comps throughout the rest of 2021 will create challenging optics for the stock, the analyst tells investors in a research note.
FIFTH THIRD UPGRADED TO CONVICTION BUY: Goldman Sachs analyst Ryan Nash added Fifth Third Bancorp (FITB) to the firm's Conviction List and keeps a Buy rating on the shares with 27% upside to his $45 price target. The analyst views Fifth Third as a "cheap" way to play rate upside optionality with limited downside in a low rate scenario and "significant upside" if higher rates do come through. The bank is sitting on "significant excess capital" could get much more aggressive in deploying capital in the coming quarters, driving upside to estimates, Nash tells investors in a research note.
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