Spirit upgrade, Netflix downgrade, and Take-Two reinstatement 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:
- JPMorgan analyst Jamie Baker upgraded Spirit Airlines (SAVE) to Overweight from Neutral with a price target of $30, up from $24. The analyst also named Spirit a "tactical trade idea." Baker believes "some merger involving Spirit is a high probability outcome." A merger outcome between Spirit and JetBlue (JBLU) is a growing probability and may overtake the likelihood of a Frontier (ULCC) deal, Baker tells investors in a research note.
- Atlantic Equities analyst Simon Clinch upgraded CME Group (CME) to Overweight from Neutral with an unchanged price target of $235, which offers a total return of more than 20%. The stock has pulled back despite CME having the strongest fundamental backdrop of the U.S. exchanges, Clinch tells investors in a research note.
- Wedbush analyst Michael Pachter upgraded SciPlay (SCPL) to Outperform from Neutral with a price target of $17, up from $14.50. The analyst believes several growth drivers could ultimately enable SciPlay to beat expectations for the next few years, including "Alictus and the ad business, a pipeline of new casual releases, the gradual rollout of Project All Star and the evolution of the SciPlay engine, and the emergence of the direct-to-consumer platform."
- Citi analyst Vivek Midha upgraded Knorr-Bremse (KNRRY) to Buy from Neutral. The analyst sees momentum for orders at the company's Rail Vehicle Systems segment over the next six months and says the rail business in China could potentially recover in 2023.
- Credit Suisse analyst Tommaso Operto upgraded OC Oerlikon (OERLF) to Outperform from Neutral with a price target of CHF 9.80, down from CHF 11, after assuming coverage of the name. The analyst gained confidence in the company's growth path and margin potential at its capital markets day.
Top 5 Downgrades:
- Goldman Sachs analyst Eric Sheridan downgraded Netflix (NFLX) to Sell from Neutral with a price target of $186, down from $265. The analyst has concerns around the impact of a consumer recession as well as heightened levels of competition on demand trends, margin expansion, and levels of content spend. Sheridan also downgraded Roblox (RBLX), eBay (EBAY), and Frontdoor (FTDR).
- Evercore ISI analyst Kirk Materne downgraded DocuSign (DOCU) to In Line from Outperform with a price target of $75, down from $100, post the Q1 results. While the shares are probably close to a bottom if one is taking a longer-term view, the combination of tough compares and continued execution challenges means any meaningful rebound in billings growth is still "further out than we hoped," Materne tells investors in a research note. William Blair analyst Jake Roberge also downgraded DocuSign to Market Perform from Outperform without a price target following last night's results.
- Morgan Stanley analyst Benjamin Swinburne downgraded iHeartMedia (IHRT) to Underweight from Equal Weight with a price target of $11, down from $25. The analyst cut expectations for advertising growth in 2023 to reflect the "rising risk of macro headwinds," with his bear case now reflecting a mild recession. Swinburne also downgraded Lamar Advertising (LAMR) to Equal Weight from Overweight with a price target of $103, down from $135.
- MoffettNathanson analyst Clay Griffin downgraded Electronic Arts (EA) to Neutral from Buy with a price target of $147, up from $141. The downgrade follows the analyst's upgrade to Buy just four weeks ago. After a 22% absolute move in the stock, and 21% outperformance relative to the market, "we can't help but feel like the proverbial dog that unexpectedly caught the car it was chasing," Griffin tells investors in a research note.
- Goldman Sachs analyst Brooke Roach downgraded Kontoor Brands (KTB) to Neutral from Buy with a price target of $41, down from $55. Accelerating cost pressures have weighed on the company's margin delivery and earnings growth, Roach tells investors in a research note.
Top 5 Initiations:
- Goldman Sachs analyst Eric Sheridan reinstated coverage of Take-Two (TTWO) with a Neutral rating and $136 price target. Following its acquisition of Zynga (ZNGA), the company has gained access to a developer and distributor of social mobile games and should be able to continue its progression as a leading developer of gaming IP across a wider array of distribution modes, the analyst tells investors in a research note.
- Stephens analyst Charles Nabhan initiated coverage of Flywire (FLYW) with an Overweight rating and $24 price target. His constructive view of the provider of payment and software solutions to the healthcare, education, travel and B2B sectors shares is based on what he sees as "a highly defensible moat," levers for growth within its existing customer base and verticals, and its path to profitability, Nabhan tells investors.
- BofA analyst Chase Mulvehill initiated coverage of ProFrac Holding (PFHC) with a Buy rating and $26 price target. Frac profitability is set to rise "materially" into 2023 as improving pricing flows through to all of the active fleets, Mulvehill tells investors in a research note.
- Wedbush analyst Laura Chico initiated coverage of Design Therapeutics (DSGN) with an Outperform rating and $21 price target. The analyst likes the setup on shares, citing Design Therapeutics' lead asset, DT-216, in a Phase 1 study in FA patients and data arriving in the second half of FY22, and assuming an earliest potential DT-216 launch in FY25 with FY31 revenue reaching $1.3B.
- MKM Partners analyst Scott Stember initiated coverage of Standard Motor Products (SMP) with a Buy rating and $62 price target. The analyst says improving margins and accelerating revenue growth will drive multiple expansion from current "depressed" levels over the next 18 months.
Symbols:
SAVE JBLU ULCC CME - $197.95 /
-0.045 (-0.02%)
SCPL NFLX RBLX EBAY FTDR DOCU IHRT LAMR EA KTB TTWO ZNGA FLYW PFHC DSGN KNRRY OERLF SMP Keywords: analyst, analyst calls, upgrades, downgrades, initiations, research, wall street