Check out today's top analyst calls from around Wall Street, compiled by The Fly.
POTENTIAL RETURN TO 'OUTSIZED' SALES GROWTH: Oppenheimer analyst Brian Nagel upgraded Under Armour (UAA) to Outperform from Perform with a $30 price target. Over the past several years, Under Armour's "once enviable brand" has suffered meaningfully owing to significant mismanagement and heightened competition within the global athleisure marketplace, Nagel tells investors in a research note. While Under Armour "is not yet out of the woods," its targeted consumer focus and improved operational controls should gradually facilitate a return to outsized sales expansion and "unlock significant underlying profit potential for the company," says the analyst. He believes "healthy, if not improving" industry-wide demand growth and COVID-19 related competitive fallout should serve as tailwinds for the company's internal recovery efforts.
KB HOME GETS DOUBLE UPGRADE: Goldman Sachs analyst double Susan Maklari upgraded KB Home (KBH) to Buy from Sell with a price target of $51, up from $32. The company's build-to-order strategy leaves it well positioned entering 2021 with a backlog up 54%, bucking seasonal norms and providing greater visibility to near-term earnings, Maklari tells investors in a research note. The analyst sees KB's results benefitting from community count growth starting in the second half of the year, quarterly EBIT margin expansion through the year and easier comparisons as it laps the "self-induced, more restrictive shutdown" it endured in 2020 as the pandemic set in. Heading into the selling season for Homebuilders, Maklari highlights Buy-rated D.R. Horton (DHI), PulteGroup (PHM) and KB Home as top picks.
'LOOKING TIRED': JPMorgan analyst Sean Meakim downgraded MRC Global (MRC) to Neutral from Overweight and NOW Inc. (DNOW) to Underweight from Neutral. Both of these energy distributors have seen strong stock performance in recent months, "riding the wave of growing optimism" for North American drilling and completions activity and benefitting from investors' willingness to pay for oil beta, Meakim tells investors in a research note. While acknowledging there may be more room yet to run on this trade with oil recently surpassing $60 per barrel to reach a 12-month high, the analyst believes the risk/reward for the stocks is less favorable at these levels. The energy distribution rally is "looking tired," says Meakim.
'WORST LIKELY OVER': BofA analyst Jason Kupferberg upgraded DXC Technology (DXC) to Neutral from Underperform with an unchanged price target of $27. While DXC's business still includes a significant amount of legacy IT outsourcing, which faces ongoing structural declines, Kupferberg notes easier comps are ahead and sees incremental improvement in segment bookings, leading him to contend the "worst is likely over" as GIS segment revenue growth has likely passed its trough. However, within his IT Services coverage, he prefers to own Cognizant (CTSH) and Epam Systems (EPAM) over DXC, the analyst added.
WD-40 CUT ON HARD COMPS, INPUT COSTS: DA Davidson analyst Linda Bolton Weiser downgraded WD-40 (WDFC) to Neutral from Buy with an unchanged $353 price target. The stock run-up has taken valuation to 50-times expected 2022 earnings, while the company is facing a potential sales decline against hard comps in Q4 and gross margin compression due to higher input costs, the analyst tells investors in a research note.
GEVO PRICE TARGET MORE THAN TRIPLED: H.C. Wainwright analyst Amit Dayal raised the firm's price target on Gevo (GEVO) to $18 from $5 and keeps a Buy rating on the shares. The company's recently completed $350M financing "materially improves" its ability to execute on building its first 45M gallon hydrocarbon plant, Dayal tells investors in a research note.
Under Armour
-0.12 (-0.54%)
Under Armour
-0.14 (-0.75%)
MRC Global
-0.07 (-0.81%)
DNOW Inc.
-0.315 (-3.02%)
DXC Technology
-0.505 (-1.94%)
Cognizant
-1.56 (-2.04%)
Epam Systems
-15.27 (-3.89%)
WD-40
+0.88 (+0.28%)
Gevo
-1.805 (-14.48%)
KB Home
-0.575 (-1.39%)
D.R. Horton
-0.2 (-0.26%)
PulteGroup
-0.705 (-1.53%)