ServiceNow upgrade, Toll Brothers downgrade and Beyond Meat coverage initiation among today's top calls on Wall Street Institutional investors and professional traders rely on The Fly to learn which companies the best analysts on Wall Street are saying to buy and sell.
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:
- Piper Sandler analyst Rob Owens upgraded ServiceNow (NOW) to Overweight from Neutral with an unchanged price target of $650. Subscription billings acceleration and large deal strength punctuated a "solid" fourth quarter result from the company, Owens argued.
- Summit Insights analyst Kinngai Chan upgraded Seagate (STX) to Buy from Hold following second quarter results. The analyst expects the demand profile for large-cap hard disk drive in the cloud datacenter and enterprise server to accelerate through 2022 as hyperscale customer capex ramps through the year.
- Seaport Global analyst Glenn Chin upgraded CarMax (KMX) to Buy from Neutral with a $140 price target, citing valuation.
- Truist analyst Andrew Jeffrey upgraded Equifax (EFX) to Buy from Hold with a price target of $280, up from $245. The analyst is positive on the company's status as the No. 1 U.S. credit bureau, led by its "differentiated EWS franchise," stating that he expects to see financial upside in 2022-2023 as price and share gains "outstrip" the well-appreciated mortgage headwinds.
- Bank of America analyst Rafe Jadrosich upgraded KB Home (KBH) to Buy from Neutral with a price target of $53, down from $56. KB Home trades at the cheapest price-to-book valuation across his homebuilder coverage, despite a return-on-equity that has improved to 25% from the low-double-digit range in the last two years, giving it the "most attractive relative valuation in homebuilders," Jadrosich contended.
Top 5 Downgrades:
- Bank of America analyst Rafe Jadrosich downgraded Toll Brothers (TOL) to Underperform from Buy with a price target of $61, down from $85, citing his view that Toll could relatively underperform in a rising rate environment given that the stock has historically underperformed the PHLX Housing Sector Index in rising rate environments.
- Bank of America analyst Rafe Jadrosich downgraded Lennar (LEN) to Neutral from Buy with a price target of $113, down from $125. The analyst sees less upside in the shares going forward given Lennar already trades at an elevated price-to-book ratio versus peers with a higher return-on-equity.
- Truist analyst Andrew Jeffrey downgraded TransUnion (TRU) to Hold from Buy with a price target of $105, down from $135. The analyst said that while he had viewed the company as "more innovative" than Equifax (EFX) and he also liked TransUnion's lower mortgage revenue exposure, he now sees it lagging Equifax's innovation in key areas.
- Argus analyst Jasper Hellweg downgraded Teva (TEVA) to Hold from Buy as he is concerned about a recent jury verdict in New York related to its role in the opioid epidemic, with the company now proceeding "to a separate case determining additional damages" in addition to the $1.5B already negotiated with New York Attorney General Letitia James.
- Bank of America analyst Adrien de Saint Hilaire downgraded WPP (WPP) and Interpublic Group (IPG) to Underperform from Neutral with price targets of $75 and $32, respectively. The analyst sees a tougher setup for the advertising agencies into 2022.
Top 5 Coverage Initiations:
- Mizuho analyst John Baumgartner initiated coverage of Beyond Meat (BYND) with a Neutral rating and $59 price target. Shares have exhibited "extreme volatility" since the company came public in May 2019 and he believes long-term expectations are too high.
- Mizuho analyst John Baumgartner initiated coverage of Oatly Group (OTLY) with a Neutral rating and $7 price target. The analyst believes patient investors may find a better entry point given current headwinds from supply chain challenges and significant cost inflation.
- Jefferies analyst David Kelley initiated coverage of Ambarella (AMBA) with a Buy rating and $170 price target. The analyst views cameras as key to Advanced Driver Assistance Systems, or ADAS, advancements through 2025 and sees Ambarella as an emerging beneficiary given opportunities inside the vehicle via driver monitoring systems and eMirrors alongside ADAS advancements.
- UBS analyst Steven Fisher initiated coverage of Dycom (DY) with a Buy rating and a price target of $125. The analyst expects some upside from the stock investors "come to appreciate" the company's earning potential from the emerging telecom investment cycle ahead. Dycom offers pure-play exposure to telecom investment, which should drive near-double digit organic growth over the next three years, Fisher tells investors in a research note.
- Jefferies analyst David Kelley initiated coverage of Luminar (LAZR) with a Buy rating and $20 price target. The analyst views Luminar as "an emerging LiDAR leader" supported by a strong commercial customer and partner list, and sees the company having a roadmap to scaled series production and "likely market share leadership in autos."
Symbols:
NOW - $548.02 /
+64.13 (+13.25%)
STX - $116.55 /
+20.18 (+20.94%)
KMX EFX KBH TOL LEN TRU WPP IPG BYND AMBA DY LAZR OTLY Keywords: analyst, analyst calls, upgrades, downgrades, initiations, research, wall street