Micron upgrade, J.B. Hunt downgrade, and Microsoft resumption 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:
Summit Insights analyst KinNgai Chan upgraded Micron (MU) to Buy from Hold. The DRAM demand-supply dynamics will remain challenging through early 2023 as demand weakness and customer inventory correction continue in the near term, though industry dynamics will improve once channel inventory correction is completed by the first half of 2023 and DDR5 DRAM ramps into volume, the analyst tells investors in a research note. :the
Jefferies analyst David Windley upgraded Charles River (CRL) to Buy from Hold with a price target of $240, up from $230. The nonhuman primate, or NHP, supply chain has dramatically changed during COVID and he believes scarce NHP supply for preclinical studies is driving most of Charles River's DSA pricing, revenue, and backlog growth.
Piper Sandler analyst Kevin Barker upgraded Rithm Capital (RITM) to Neutral from Underweight with a price target of $9, down from $10. The company is not immune to pressures on its investment portfolio as assets are marked down from higher rates, but Rithm should see some offsets due to its large mortgage servicing rights portfolio, Barker tells investors in a research note.
Citi analyst Alexander Hacking upgraded Agnico Eagle (AEM) to Buy from Neutral with a price target of $50, down from $72. The analyst updated gold models ahead of the Q3 results to reflect updated price forecasts from Citi's commodity team. Gold stocks have been hit hard by the selloff, creating an opportunity for investors to accumulate, Hacking tells investors in a research note.
Piper Sandler analyst John Barnidge upgraded Voya Financial (VOYA) to Overweight from Neutral with a price target of $70, up from $65. The analyst sees the company as a "net beneficiary" from higher inflation.
Top 5 Downgrades:
KeyBanc analyst Todd Fowler downgraded J.B. Hunt Transport Services (JBHT) to Sector Weight from Overweight without a price target. The analyst is "incrementally cautious" on the transportation and logistics sector after his channel checks indicated freight activity was seasonally weak through late-September, with limited indication of holiday demand to-date. The analyst also downgraded Schneider National (SNDR) to Sector Weight from Overweight.
Wolfe Research analyst Timna Tanners downgraded Century Aluminum (CENX) to Underperform from Peer Perform with a $4 price target. The company's earnings outlook has "deteriorated" with lower aluminum prices and higher power costs, Tanners tells investors in a research note.
Maxim analyst Jack Vander Aarde downgraded Esports Entertainment (GMBL) to Hold from Buy. Following the divestment of its Helix operations and gaming centers, the company's remaining iGaming and betting businesses are poised to be future growth drivers, the analyst tells investors in a research note, adding that its current FY22 revenue guidance of over $55M represents "robust y/y growth."
Daiwa analyst Cynthia Chan downgraded CIFI Holdings (CFFHF) to Hold from Buy with a price target of HK$0.90, down from HK$4. The company's non-standard debt payment miss may not trigger a cross default, but it "may be the beginning of a vicious cycle for CIFI," Chan tells investors in a research note.
Morgan Stanley analyst Cedar Ekblom downgraded Rockwool (RKWBF) to Equal Weight from Overweight with a price target of DKK 1,550, down from DKK 1,780. The analyst says that while the "bear case" presents another 15% downside, this is not an appealing risk/reward for a stock "that could double if the energy backdrop stabilizes."
Top 5 Initiations:
Raymond James analyst Andrew Marok resumed coverage of Microsoft (MSFT) with an Outperform rating and $300 price target. He sees Microsoft having "a collection of sustainable advantages," including strong positioning in public cloud, gaming and digital advertising, scale advantages from years of investment, and deep relationships with enterprise software buyers, Marok tells investors.
Barclays analyst Peter Lawson initiated coverage of Relay Therapeutics (RLAY) with an Equal Weight rating and $23 price target. Relay is a clinical stage biotechnology company using artificial intelligence to develop small molecule therapies to treat cancer, Lawson tells investors in a research note. While the company has shown "encouraging platform validation," the stock is fairly valued ahead of the initial PI3Kalpha inhibitor data for RLY-2608 in the first half of 2023, says the analyst.
Cantor Fitzgerald analyst Brett Knoblauch initiated coverage of Rubicon Technologies (RBT) with an Overweight rating and $5 price target. Knoblauch thinks Rubicon has the potential to become an essential intermediary within the waste management business, making its risk/reward profile favorable with shares currently trading at 76% below the SPAC transaction price, the analyst tells investors in a research note.
UBS analyst Cody Ross initiated coverage of Freshpet (FRPT) with a Buy rating and $67 price target. The analyst is positive on the stock that trades at a "discount" but represents a "high growth company" that is on the verge of a profitability inflection.
Canaccord analyst T. Michael Walkley initiated coverage of CyberArk (CYBR) with a Buy rating and $187 price target. CyberArk is the "clear leader" in the Privileged Access Management, or PAM, space and a long-term winner in the software security market, Walkley tells investors.