BofA/Merrill Lynch analyst Ruplu Bhattacharya downgraded Avnet (AVT) to Neutral from Buy after the company gave more details on the impact of the Texas Instruments (TXN) disengagement during its earnings call, stating that it will lose about $2B of annual revenue and implying an annual EPS impact of about $1.15. Although the TI business was "low-margin fulfillment" and Avnet announced an incremental $35M in restructuring on top of its previously announced plan, the company will be hurt in the near-term from having a larger infrastructure and workforce while being faced with lower revenues, Bhattacharya said. Lower volumes in the near-term due to both the TI disengagement plus a weak macro environment will hurt margins over the next 3-4 quarters, said Bhattacharya, who thinks some can be offset by benefits from added restructuring. The analyst cut the price target on Avnet shares to $44 from $47.

Catch up on today's top five analyst upgrades with this list compiled by The Fly: 1. Starbucks (SBUX) upgraded to Outperform from Market Perform at BMO Capital with analyst Andrew Strelzik viewing Starbucks as a "reopening beneficiary with meaningful potential upside" to consensus estimates over the next two fiscal years. 2. Texas Instruments (TXN) upgraded to Outperform from Market Perform at Raymond James with analyst Christopher Caso saying the company has managed to grow earnings and cash flow despite a lack of M&A, adding that he is confident in strong business conditions over the next several quarters as customer inventory remains at historic lows and supply remains tight. 3. MGM Resorts (MGM) upgraded to Buy from Hold at Argus with analyst John Staszak saying the company should benefit from the recent decision by the governor of Nevada to allow casinos to operate at 50% capacity, adding that demand among leisure travelers should recover this summer. 4. Palo Alto Networks (PANW) upgraded to Outperform from Market Perform at BMO Capital with analyst Keith Bachman contending that the company is well positioned with its security portfolio, and as customer requirements continue to "evolve and become more complicated," Palo Alto will have market share gain opportunities. 5. Intuit (INTU) upgraded to Outperform from In Line at Evercore ISI with analyst Kirk Materne saying he expects a reacceleration in Quickbooks Online growth this spring and summer as the small-to-midsize business market rebounds and forecasts "another strong tax season" as Intuit continues to take share from traditional tax advisors. This list is just a portion of The Fly's full analyst coverage. To see The Fly's full Street Research coverage, click here.

Citi analyst Zhen Yang opened a pair trade in the North America electronic components and equipment sector of overweight Arrow Electronics (ARW), underweight Avnet (AVT). The analyst thinks supply chain inventory restocking remains in the early stages and that component shortages could be sustained to the second half of 2021 given lean inventories in the channel after destocking. Arrow is better positioned than Avnet to monetize the component shortages, Yang tells investors in a research note.