Check out today's top analyst calls from around Wall Street, compiled by The Fly.
ABILITY TO 'STOMP THE COMP': Gordon Haskett analyst Chuck Grom upgraded Lowe's (LOW) to Buy from Accumulate with a price target of $202, up from $196. The analyst is more confident now that he was when he had previously downgraded the stock in November in Lowe's ability to "stomp the comp" in 2021 given both company specific efforts and "very favorable" macro and housing backdrop. While rising interest rates could potentially slow sales in the coming quarters, Grom thinks the market has been "over-penalizing the home improvement stocks of late."
BUY SQUARE: Guggenheim analyst Jeff Cantwell upgraded Square (SQ) to Buy from Neutral with a $288 price target. The response in shares over the past two days is largely a near-term momentum-driven negative reaction to this week's decline in the price of Bitcoin, presenting an opportunity to buy Square following "strong" fourth quarter results, Cantwell told investors in a research note. The analyst thinks the outlook in Seller looks increasingly positive in a post-vaccine environment where SMBs are showing fresh signs of confidence.
PROFITABILITY FROM STREAMING UNCLEAR: Loop Capital analyst Alan Gould downgraded ViacomCBS (VIAC) to Sell from Hold but raised the firm's price target to $43 from $28. The company's streaming strategy presentation included an "impressive" content slate, with the management projecting 65M-75M in global streaming subscribers by 2024, the analyst told investors in a research note. Gould believes focus shift to streaming was necessary as the total advertising revenue for ViacomCBS in the fourth quarter would have been down if not for political advertising, although incremental profitability from its streaming business is still "not clear."
MULTIPLE HEADWINDS: Bank of America analyst Robert Ohmes downgraded Dollar Tree (DLTR) to Underperform from Buy with a price target of $95, down from $123. While he sees upside to fiscal fourth quarter given acceleration to start the quarter, general merchandise tailwinds, and January stimulus and also views comparisons to start fiscal year 2022 as "relatively easy," Ohmes noted that his fiscal year 2023 earnings per share estimate of $6.50 is below consensus as he sees wage, freight and traffic recovery headwinds. He also expects comps to decelerate at the Family Dollar banner against tough average ticket comparisons.
Ohmes also downgraded Dollar General (DG) to Neutral from Buy with a price target of $215, down from $245. The analyst expects same store sales to inflect negatively in fiscal first quarter as Dollar General begins lapping difficult comparisons from this year and he would expect multiple compression in such a decelerating to negative comp environment.
MOVING TO THE SIDELINES: Oppenheimer analyst Timothy Horan downgraded Verizon (VZ) and AT&T (T) to Perform from Outperform, citing valuation. The analyst noted that C-Band Auction results were released and the quiet period should end March 10. Verizon bid $45.4B or about $13M per license, while AT&T won 1,621 licenses for $23.4B compared to Horan's $20B forecast. The analyst thinks Verizon/AT&T bid aggressively to catch up with T-Mobile's (TMUS) 5G network quality, which spent $9.3B for 142 licenses, likely coverage gaps. Horan adds that "surprisingly," Cable and Dish (DISH) spent very little.
Meanwhile, Scotiabank analyst Jeff Fan also downgraded Verizon to Sector Perform from Outperform with a price target of $59, down from $61, due to higher-than-expected net debt after the FCC announced final results of the completed $81B C-Band auction, which showed that Verizon "as the market had feared" was the biggest spender in acquiring over half of all the spectrum licenses for $46.5B. While the "good news is the results reduced the threat of a viable fourth wireless operator," the "bad news" includes higher spending that will take some time to pay off and the fact that neither Verizon nor AT&T closed T-Mobile's "relative mid-band advantage," Fan told investors.
Lowe's
-0.21 (-0.13%)
Block
+6.56 (+2.76%)
Use PARA
+0.925 (+1.41%)
Use PARA
+0.99 (+1.51%)
Dollar Tree
-2.1 (-2.08%)
Dollar General
-2.325 (-1.21%)
Verizon
-0.8 (-1.40%)
AT&T
-0.27 (-0.92%)
T-Mobile
+3.59 (+3.01%)
Merged into SATS
+0.65 (+2.07%)