Booking upgraded, Paramount downgraded: Wall Street’s top analyst calls

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:

• DA Davidson upgraded Booking Holdings (BKNG) to Buy from Neutral with an unchanged $3,400 price target. The firm is looking to take advantage of the recent pullback in the stock – down 7% since the end of September – while reporting “solid” Q3 results and giving “encouraging” commentary for 2024.
• Citi upgraded Visteon (VC) to Buy from Neutral with a $149 price target. The firm believes the recent weakness in the shares “presents a more compelling entry point.”
• UBS upgraded Clorox (CLX) to Neutral from Sell with a price target of $132, up from $124. Even after the stock’s 9% rally post results last week, the risk/reward is balanced with concerns around relative share performance and the ability to return to volume growth offset by shares trading at a narrower premium to peers and the potential for a meaningful earnings recovery in fiscal 2025, the firm says.
• Keefe Bruyette upgraded Bank of America (BAC) to Market Perform from Underperform with a price target of $30, up from $29. The firm cites the recent decline in long-term rates following the better-than-expected productivity report and weaker than expected jobs report for the upgrade.
• Keefe Bruyette upgraded KeyCorp (KEY) to Outperform from Market Perform with a price target of $15, up from $12.50. The firm believes the recent labor productivity and jobs reports are “game changers,” resulting in a material easing of the pressure on long-term rates and thus improved visibility on capital.

Top 5 Downgrades:

• BofA double downgraded Paramount (PARA) to Underperform from Buy with a price target of $9, down from $32. The firm’s prior bullish thesis and valuation methodology was predicated on Paramount’s inherent asset value in a potential sale, but it does not appear any significant asset sales are on the horizon despite the company receiving credible bids for several different assets, such as Showtime and BET.
• OTR Global downgraded its view on Baidu (BIDU) to Negative from Mixed as its checks found brand advertisers shifted budgets away from Baidu search during Q3 as they sought better search formats and performance in social media, short video and e-commerce.
• HSBC downgraded SolarEdge Technologies (SEDG) to Hold from Buy with a price target of $80, down from $243. The firm says the company’s revenue and margin guidance cut was worse than expected due to more painful channel destocking in Europe. Wells Fargo also downgraded SolarEdge Technologies to Equal Weight from Overweight with a price target of $82, down from $190.
• Raymond James downgraded Bloomin’ Brands (BLMN) to Outperform from Strong Buy with a price target of $28, down from $29. The firm continues to see value in the shares and potential catalysts from activist Starboard, but says this is offset by Outback Steakhouse’s continued traffic underperformance.
• HSBC downgraded Fortinet (FTNT) to Hold from Buy with a price target of $49, down from $75. The company’s revenue and billing guidance suggests a structural slowdown in the secure connectivity segment, the firm tells investors in a research note.

Top 5 Initiations:

• Telsey Advisory initiated coverage of Birkenstock (BIRK) with an Outperform rating and $47 price target. The heritage footwear brand “rooted in function, quality, and tradition” has a loyal customer base, “strong” topline trends and “an industry-leading margin profile,” all while it has been expanding its portfolio and reach, the firm says. William Blair, JPMorgan, Jefferies, Mizuho, Citi, Baird, Goldman Sachs, BMO Capital, Piper Sandler, Stifel, and Williams Trading also started coverage of Birkenstock with Buy-equivalent ratings. Not as bullish, BofA, HSBC, Morgan Stanley, UBS, and Deutsche Bank initiated the name with Neutral-equivalent ratings.
• Barclays initiated coverage of WK Kellogg (KLG) with an Underweight rating and $11 price target. The firm sees the next of couple of years as a “likely challenging transition” period for WK Kellogg, in light of a flat sales outlook in a declining ready-to-eat cereal category.
• Mizuho initiated coverage of Bilibili (BILI) with a Buy rating and $18 price target. The firm expects the company to successfully transition its products to more than double the total addressable market, accelerate sales growth to double digits, and reach profitability in fiscal 2024.
• RBC Capital initiated coverage of Confluent (CFLT) with an Outperform rating and $22 price target. The firm views the company’s 2024 estimates are more reasonable post the Q3 report and sees upside as likely.
• H.C. Wainwright initiated coverage of Bitcoin Depot (BTM) with a Buy rating and $6 price target. The firm says the company is one of the very few investment vehicles that provides investors with exposure to the secular growth in bitcoin adoption, and a “durable and growing earnings stream” that isn’t directly correlated to bitcoin price levels.