Alcoa upgrade, FedEx downgrades, and Palo Alto Networks initiation among today's top calls on Wall Street
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Research analysts at Wall Street's largest banks issue recommendations on whether a stock should be bought, held, or sold. The Fly's team of financial market experts scours hundreds of research notes daily to uncover the best trading ideas. Check out today's top analyst calls from around Wall Street, compiled by The Fly.
Top 5 Upgrades:
Morgan Stanley analyst Carlos De Alba upgraded Alcoa (AA) to Overweight from Equal Weight with a price target of $66, up from $51. The analyst believes value is beginning to show within Americas metals and mining stocks, but cautions that uncertainty remains.
Cowen analyst Jeffrey Osbourne upgraded Shoals Technologies (SHLS) to Outperform from Market Perform with a price target of $37.50, up from $29. The analyst sees a "compelling opportunity" over the next six months for Shoals due to the launch of new products that leverage the company's insulation and fusing patent portfolio for solar cabling and connectors.
JPMorgan analyst Stephen Tusa double upgraded Ansys (ANSS) to Overweight from Underweight with a $275 price target after resuming coverage of the name. Ansys has a strong intellectual property moat in an industry with a "multitude of growth vectors," Tusa tells investors in a research note.
Morgan Stanley analyst Carlos De Alba upgraded Teck Resources (TECK) to Overweight from Equal Weight with a price target of $51, up from $41. The analyst believes value is beginning to show within Americas metals and mining stocks, but cautions that uncertainty remains.
JPMorgan analyst Neil Green upgraded Gecina (GECFF) to Overweight from Neutral with a price target of EUR 112, down from EUR 137. The analyst reset expectations "for what could be a challenging period" for European property.
Top 5 Downgrades:
JPMorgan analyst Brian Ossenbeck downgraded FedEx (FDX) to Neutral from Overweight with a price target of $214, down from $258. The results reported last night likely had a material tailwind from fuel surcharges in a similar way to Q4, which masks the underlying weakness in fiscal Q1 and the Q2 outlook, Ossenbeck tells investors in a research note. FedEx was also downgraded at KeyBanc, Stifel, BofA, and Loop Capital.
Jefferies analyst Philip Ng downgraded International Paper (IP) to Underperform from Hold with a price target of $31, down from $40. The analyst cut estimates to reflect the "massive inventory glut" in containerboard. Channel checks indicate orders are decelerating sharply and broad based downtime is being taken, even by the smaller players, Ng tells investors in a research note.
Wells Fargo analyst Joseph Quatrochi downgraded Arrow Electronics (ARW) to Underweight from Equal Weight with a price target of $87, down from $125. A "broadening of weakening demand data points and some deterioration of average component pricing" will put additional downward pressure on distributor earnings beyond current consensus estimates, Quatrochi tells investors in a research note. Quatrochi also downgraded Avnet (AVT) to Underweight from Equal Weight with a price target of $35, down from $45.
BofA analyst Brad Sills downgraded Adobe (ADBE) to Neutral from Buy with a price target of $350, down from $450. The company's acquisition of Figma of a long-term positive but a near-term "overhang," Sills tells investors in a research note. Baird analyst Rob Oliver also downgraded Adobe to Neutral from Outperform with a price target of $355, down from $450.
Cowen analyst John Kernan downgraded Adidas (ADDYY) to Market Perform from Outperform with a price target of EUR 155, down from EUR 188. The analyst is "increasingly cautious" on Adidas due to weakening inbound data versus peers and "clear loss of mindshare."
Top 5 Initiations:
MKM Partners analyst Catharine Trebnick initiated coverage of Palo Alto Networks (PANW) with a Buy rating and $250 price target as part of a broader research note on the Cyber Security Software Sector. Palo Alto Networks is her top pick in the industry given the company's 75% revenue from subscription services, the analyst tells investors in a research note.
KeyBanc analyst Scott Schoenhaus initiated coverage of Teladoc (TDOC) with a Sector Weight rating. The analyst noted that the telehealth/digital health sector is becoming more fragmented as many new platforms have come to market.
Wedbush analyst Laura Chico initiated coverage of Vigil Neuroscience (VIGL) with an Outperform rating and $19 price target. While the company's lead program VGL101 is in the early days, the preliminary healthy volunteer readout is providing important insight into both VGL101's safety profile and target engagement, the analyst tells investors in a research note.
Needham analyst Mike Cikos initiated coverage of Snowflake (SNOW) with a Buy rating and $240 price target. The company benefits from its cloud-native data platform, which has "massive scale," Cikos tells investors in a research note.
UBS analyst Wei Xiong initiated coverage of Baidu (BIDU) with a Buy rating and HK$191.30 price target. The company's risk-reward appears "attractive" as investors assign little value to its new initiatives in cloud and cars, the analyst tells investors in a research note.