The most talked about and market moving research calls around Wall Street are now in one place. Here are today's research calls that investors need to know, as compiled by The Fly.
Top 5 Upgrades:
- Citi upgraded McCormick (MKC) to Neutral from Sell with a price target of $69, up from $68. The firm models the company's fiscal Q2 sales and earnings above the consensus and looks for McCormick to boost its fiscal 2024 outlooks for sales, operating profit and earnings.
- Craig-Hallum upgraded PagerDuty (PD) to Buy from Hold with a price target of $30, up from $21, as a different analyst at the firm assumed coverage of the stock. While tech industry employment pressures and overall "economic malaise" have resulted in churn and lengthened enterprise cycles, PagerDuty has made material improvements that should bear fruit going forward rather than "sitting reactively and taking the headwinds," the firm tells investors.
- Citi upgraded Darling Ingredients (DAR) to Buy from Neutral with a $48 price target. The firm says that after a "tough stretch" for the company, it sees "better times ahead."
- Morgan Stanley upgraded Ciena (CIEN) to Overweight from Equal Weight with a price target of $55, up from $53. The company's FY24 setup is now "more achievable," with upside potential in FY25 being driven by both service provider and cloud verticals, the firm tells investors in a research note.
- Needham upgraded Haemonetics (HAE) to Buy from Hold with a $112 price target. The firm says its mix analysis brought increased confidence the company can meet its high-20% fiscal 2026 operating margin target.
Top 5 Downgrades:
- Wells Fargo downgraded Paramount (PARA) to Underweight from Equal Weight with a price target of $9, down from $14. With the Skydance deal off, removing the potential for 50% of shares to be tendered at $15/share, and no potential M&A beyond an NAI sale, the stock is back to being valued on fundamentals, the firm tells investors in a research note.
- Morgan Stanley downgraded Pure Storage (PSTG) to Equal Weight from Overweight with a $60 price target. The stock has risen over 80% year-to-date on a potential hyperscaler design deal and AI enthusiasm, but at 36-times expected FY26 free cash flow, its valuation now accounts for the design win and AI near-term opportunity, the firm tells investors in a research note.
- Goldman Sachs downgraded Birkenstock (BIRK) to Neutral from Buy with a price target of $58, up from $54.20. While acknowledging "strong" brand momentum, the firm says that recent strong performance leaves the shares fairly valued.
- UBS downgraded Academy Sports (ASO) to Neutral from Buy with a price target of $58, down from $81. The shares are likely to remain rangebound as the market will likely continue to believe that the company's fiscal 2024 guidance is too optimistic and could face the prospect of downward estimate revisions. Wells Fargo also downgraded Academy Sports to Equal Weight from Overweight.
- Noble Capital downgraded CoreCivic (CXW) to Market Perform from Outperform after Immigration and Customs Enforcement informed the company of its intention to terminate the existing agreement for use of the South Texas Family Residential Center effective August 9.
Top 5 Initiations:
- Edward Jones initiated coverage of AMD (AMD) with a Buy rating and adding shares to the firm's Stock Focus List. The firm believes the company should deliver outsized growth as growing demand for data-center infrastructure should help drive accelerating sales of AMD's chips, in particular graphics processing units, or GPUs, and central processing units, or CPUs.
- Wells Fargo initiated coverage of Global Payments (GPN) with an Equal Weight rating and $100 price target. The firm believes satisfying growth and margin expectations simultaneously will be a consistent challenge for the company.
- Wells Fargo initiated coverage of Fiserv (FI) with an Overweight rating and $180 price target. The firm believes the company scaling Clover and Carat are the key drivers to support its long-term valuation.
- Wells Fargo initiated coverage of Skechers (SKX) with an Overweight rating and $83 price target. The firm believes the most attractive, "and perhaps underappreciated," aspect of the Skechers story is both its revenue and earnings growth opportunity.
- KeyBanc initiated coverage of Realty Income (O) with a Sector Weight rating and no price target. KeyBanc says Realty Income's size likely limits growth as incremental investments may be less impactful, and larger deals may be harder to source in the current environment.
