Check out today's top analyst calls from around Wall Street, compiled by The Fly.
AIRCRAFT DEMAND: Cowen analyst Cai von Rumohr upgraded Boeing (BA) to Outperform from Market Perform with a price target of $290, up from $240. The analyst argued that "fast improving" air traffic is bolstering aircraft demand now that the U.S. has hit a 50% vaccination rate. While lingering Federal Aviation Administration oversight and timing of China's Max approval could limit Boeing's upside in 2021, its outlook in 2022 and beyond is "brighter," von Rumohr told investors in a research note. Further, the analyst sees potential for Boeing's cash flow per share to reach $21 by 2021 and believes the stock will trade on traffic expectations.
INCREASING REVENUE VISIBILITY, MARKET SHARE: Citi analyst Jeff Chung upgraded Nio (NIO) to Buy from Neutral with a price target of $58.30, up from $57.60, after the analyst lifted his 2021 China new energy vehicles sales forecast to 2.52M units from 1.79M units and 2025 sales forecast to 7.84M units from 6.86M units. For Nio, Chung expects acceleration in the second quarter order backlogs to "substantially increase" its second half of 2021 revenue visibility and market share, followed by a 2022 new model cycle. Chung also expects accelerating orders and believes Nio is the new energy vehicles sector's "Beta proxy."
'STRONG GROWTH' STORY: Morgan Stanley analyst Dara Mohsenian initiated coverage of Honest Company (HNST) with an Overweight rating and $17.50 price target. The analyst views Honest as a "strong growth story" given its skew to the "high-growth" clean/natural product categories and e-commerce channel. The company has whitespace expansion opportunities in U.S. retail, internationally, and in ancillary new product categories, Mohsenian contended.
Jefferies analyst Stephanie Wissink also started coverage of Honest Company with a Buy rating and $19 price target. Honest's formulas "go beyond global standards for banned ingredients," its brand boasts a loyal community and Wissink sees superior growth being driven by its in higher margin beauty and personal care segments. However, the analyst also noted that the company has "key woman risk" as Jessica Alba's reach in social and her "extensive network of highly recognizable and socially influential celebrity moms" are intangible assets that give Honest reach and visibility that most brands need to fund with marketing spending.
Meanwhile, William Blair analyst Jon Andersen initiated coverage of Honest Company with an Outperform rating and no price target. The company's three main target categories - diapers and wipes, skin and personal care, and household and wellness - represent $130B at retail, Andersen noted. Looking forward, the analyst expects Honest Company to grow organic sales at a compound annual rate of approximately 15%.
More cautious on the name, Loop Capital analyst Laura Champine initiated coverage of Honest Company with a Hold rating and $15 price target. Nonetheless, the analyst said she likes the company's "strong following" and a direct-to-consumer digital platform that provides "valuable data" to better understand core customers' product preferences. The Skin and Personal Care category should be a growth engine for the company as Honest penetrates a large beauty market, Champine added.
ESTIMATES TOO LOW: Bank of America analyst Jason Kupferberg upgraded Affirm (AFRM) to Buy from Neutral with a price target of $71, up from $63. The company's consensus gross merchandise value and revenue estimates seem too low given the ramp potential of its Shopify (SHOP) relationship and the momentum in its non-Peloton (PTON) business. Kupferberg also noted that Affirm's key unit economics are trending well, while investor sentiment is mixed with short interest near all-time highs at 28.8% of float.
EARNINGS GROWTH: Bank of America analyst Curtis Nagle upgraded Williams-Sonoma (WSM) to Neutral from Underperform with a price target of $180, up from $100. The company reported a "strong" set of first quarter results and its earnings growth should hold longer than previously expected thanks to its competitive advantages around scale, supply chain, and ability to cross sell across four large and well- known brands, the analyst told investors in a research note. Nagle added that Williams-Sonoma's $600M in cash and a significant increase in free cash flow give the company "ample room" for higher capex and capital return.
Boeing
+6.96 (+2.82%)
Nio
+2.52 (+6.53%)
Honest Company
+0.51 (+3.20%)
Affirm
+0.79 (+1.30%)
Peloton
+0.95 (+0.86%)
Shopify
+28.25 (+2.27%)
Williams-Sonoma
+1.795 (+1.06%)