Roblox initiation at LightShed Partners also among today's notable calls
Check out today's top analyst calls from around Wall Street, compiled by The Fly.
VIACOM UPGRADES: RBC Capital analyst Kutgun Maral upgraded ViacomCBS (VIAC) to Outperform from Sector Perform with a price target of $52, up from $26. The company's streaming momentum and "attractive" valuation are "too compelling to ignore" following the stock's recent selloff, Maral tells investors in a research note. The analyst remains "cautious as ever" on the pay TV ecosystem, but says this is more than offset by an improved outlook for ViacomCBS's positioning in a "rapidly growing" streaming opportunity. The latter is not appropriately priced in at current share levels, says Maral.
Separately, Wells Fargo analyst Steven Cahall upgraded ViacomCBS to Equal Weight from Underweight with a price target of $45, down from $59. The analyst is more constructive on the stock now that it is back to "reasonable" levels, Cahall tells investors in a research note. At this point, Cahall says valuation seems reasonable while the risk/reward is whether ViacomCBS can pull off the DTC pivot, and if so, at what financial cost.
ETSY UPGRADED TO BUY: Stifel analyst Scott Devitt upgraded Etsy (ETSY) to Buy from Hold with an unchanged price target of $205. Etsy shares sold off 15% on earnings and 35% from peak levels "despite showing that it can still grow at a healthy rate while the economy reopens," Devitt tells investors in a research note. Etsy has been "transformed" by the pandemic, says the analyst, who now expects a revenue base in 2021 that was expected in 2024 pre-Covid. He views the stock selloff as overdone. ROBLOX STARTED AT BUY: LightShed Partners analyst Brandon Ross initiated coverage of Roblox (RBLX) with a Buy rating and $85 price target. Epic's Fortnite, Roblox and Minecraft "have emerged as the dominant" platforms for gathering in virtual space and participating in 3D interactive experiences and it is clear that people will spend much more time in interactive space and that brand new experiences will emerge under the leadership of these platforms, Ross tells investors. The "category defining platforms should become massively valuable companies" and Roblox is the only of these companies in which public market investors can currently invest directly given that Minecraft is "buried inside" Microsoft (MSFT), Ross added.
BUY TAPESTRY: BTIG analyst Camilo Lyon upgraded Tapestry (TPR) to Buy from Neutral with a $65 price target. The analyst is citing the company's "strong" Q3 earnings beat and believes that the improvements Tapestry has made to its operating structure and processes "will have long-lasting, durable benefits exiting the pandemic". Exposure to fashion also "fits in well" with his view that the recovery/reopening theme comes with a "long tail", Lyon tells investors in a research note.
SHORT-TERM INVESTMENT IDEA: Deutsche Bank analyst Michael Linenberg placed a "Catalyst Call: Buy Idea" on Allegiant Travel (ALGT) as a short-term investment idea. The analyst believes shares of Allegiant are oversold following a 10% decline over the past week. The primary reason for the pullback is the company's decision to pursue an equity offering, Linenberg tells investors in a research note. On the surface dilution from the increased number of shares will be roughly 8%, but the identified use of funds, the acquisition of growth aircraft, will drive a return that will more than compensate for the increased dilution, says the analyst.
Keywords: analyst, analyst calls, upgrades, downgrades, initiations, research, wall street