Check out today's top analyst calls from around Wall Street, compiled by The Fly.
STREET OVERESTIMATING SPEED OF RECOVERY: Loop Capital analyst Alan Gould downgraded Disney (DIS) to Hold from Buy, stating that the Street is overestimating the speed of recovery from the pandemic, while the loss of the company's streaming business head Kevin Mayer adds to the uncertainty. The analyst argued that while Disney remains the "premiere traditional media company" and the management executed a "flawless" rollout of Disney+, the downturn in the economy will likely have a multi-year impact on park attendance. Gould further stated that COVID-19 has accelerated the negative trends in the traditional media business, and he prefers Netflix (NFLX) on the streaming side and Facebook (FB) on the advertising side.
CHALLENGING 'NEW NORMAL': Guggenheim analyst Mike McCormack downgraded Comcast (CMCSA) to Neutral from Buy after analyzing the "lasting effects" of the COVID-19 virus on each of the company's segments. The analyst sees NBCUniversal being "particularly challenged" given its exposure to theme parks, filmed entertainment, and advertising. Even with the possibility of parks opening, NBCUniversal's growth and profitability "will be depressed for some time," McCormack told investors in a research note titled "The 'New Normal' Makes for a Tough Road Ahead." Additionally, he believes that headwinds at Sky and ongoing video softness are likely to offset much of the likely strength from Comcast's broadband.
POTENTIAL PARTNERSHIPS: BTIG analyst Peter Saleh initiated coverage of Beyond Meat (BYND) with a Buy rating and $173 price target. The analyst cited the growing adoption of plant-based meats and the sales potential from the company's future restaurant partnerships, adding that consumers are likely to gravitate toward plant-based protein options and to support brands that "make a difference." Beyond Meat is facing challenges in becoming a ubiquitous brand and increasing manufacturing capacity, but its potential partnerships with restaurant chains such as Starbucks (SBUX), Dunkin' (DNKN), and possibly McDonald's (MCD) should elevate it to a national scale, the analyst contended.
VALUATION REFLECTING GROWTH OPPORTUNITIES: Goldman Sachs analyst Stephen Grambling initiated coverage of DraftKings (DKNG) with a Neutral rating and $32 price target. The analyst believes the company is well positioned to capture "outsized share of the rapidly growing" U.S. sports betting and internet gaming market given its existing Daily Fantasy Sports clientele of 4M and consumer preference for its app relative to competitors. However, DraftKings' valuation is largely reflective of these "unique growth opportunities," the analyst contended. He sees limited share upside after the 82% run in the past month.
'LONG ROAD TO RECOVERY': Jefferies analyst Brent Thill downgraded Expedia (EXPE) to Hold from Buy with a price target of $85, down from $100. The analyst argued that although Expedia and Booking Holdings (BKNG) are trading just above trough multiples, he is cautious on the stocks "as the recovery could be more prolonged than past downturns." There is low probability of a V-shaped recovery, Thill told investors in a research note following Jefferies' survey of over 900 consumers. The survey suggests there is pent-up travel demand, but nearly one-third are unsure on the timing of their next trip, the analyst noted.
Disney
-2.66 (-2.28%)
Netflix
+4.62 (+1.02%)
Ticker changed to META
+0.96 (+0.45%)
Comcast
-0.28 (-0.73%)
Comcast
+ (+0.00%)
Beyond Meat
+7.34 (+5.65%)
Starbucks
-0.01 (-0.01%)
Acquired by Inspire Brands
-0.25 (-0.39%)
McDonald's
-0.89 (-0.49%)
DraftKings
-0.54 (-1.83%)
Expedia
-0.42 (-0.53%)
Booking Holdings
+5.17 (+0.33%)