Goldman Sachs upgraded, Rivian 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:

• Atlantic Equities upgraded Goldman Sachs (GS) to Neutral from Underweight with a price target of $350, up from $330. Despite an earnings decline of 60% year-over-year, there were some encouraging signs in Goldman’s Q2 results, the firm says. (Read more)
• Barclays upgraded Tapestry (TPR) to Overweight from Equal Weight with a price target of $58, up from $47. The firm is gaining confidence in a 2024 sector recovery, citing near-certain visibility on the inventory issue being largely resolved across the entirety of U.S. consumer discretionary goods by the end of 2023, with clean inventory setting the stage for a bottoming in merchandise margins in the second half of 2023 and margin improvement in 2024. (Read more)
• Barclays upgraded Bath & Body Works (BBWI) to Overweight from Equal Weight with a price target of $45, up from $41. Barclays believes the wallet drag of “essential”-category inflation on discretionary goods within a household is abating. (Read more)
• RBC Capital upgraded ResMed (RMD) to Outperform from Sector Perform with a price target of $284, up from $262. The firm has a positive outlook for ResMed given low obstructive sleep apnea penetration rates, an improving supply chain of component parts, a backlog of re- PAP customers, and the company’s “strong market position.” (Read more)
• Barclays upgraded Gap (GPS) to Overweight from Equal Weight with a price target of $13, up from $9, as the firm also upgraded the U.S. specialty appeal retail sector to Positive from Neutral. (Read more)

Top 5 Downgrades:

• Cantor Fitzgerald downgraded Rivian Automotive (RIVN) to Neutral from Overweight with a price target of $29, up from $27. The firm cites valuation and increased competition from Tesla’s (TSLA) Cybertruck, as well as from General Motors (GM) and Ford Motor (F). (Read more)
• Citi downgraded Estee Lauder (EL) to Neutral from Buy with a price target of $195, down from $240. The firm sees increasing risks to the recovery path for the Asian business over the next 6-12 months. (Read more)
• Keefe Bruyette downgraded SoFi Technologies (SOFI) to Underperform from Market Perform with a price target of $7.50, up from $5.50. After rallying 142% since the mid-May trough, the company’s valuation “has overshot the fundamental earnings outlook,” the firm tells investors in a research note. (Read more)
• Deutsche Bank downgraded ZoomInfo (ZI) to Hold from Buy with a $20 price target. The company reported “disappointing” Q2 results that suffered from further deterioration and down selling within the technology customer vertical, the firm says. (Read more)
• RBC Capital downgraded New Relic (NEWR) to Sector Perform from Outperform with a price target of $87, down from $95, after the company announced an agreement to be acquired by TPG and Francisco Partners at $87 per share in cash in a $6.5B deal. (Read more) Baird also downgraded New Relic to Neutral from Outperform with a price target of $87, down from $92. (Read more)

Top 5 Initiations:

• Seaport Research initiated coverage of TopBuild (BLD)with a Buy rating and $315 price target. While residential risks “always exist,” TopBuild’s growing non-residential mix should provide less cyclical, higher recurring growth prospects, the firm says. (Read more)
• Seaport Research initiated coverage of Installed Building Products (IBP) with a Buy rating and $170 price target. The firm says the company’s incremental approach to growth by increasing its share of each home built “offers a sustained, relatively low risk path to growth at attractive M&A valuations.” (Read more)
• Morgan Stanley initiated coverage of Vivid Seats (SEAT) with an Equal Weight rating and $9.50 price target. Secondary ticketing is competitive, requiring substantial marketing spend, says the firm, which leaves it more cautious than consensus estimates on near-term margins. (Read more)
• Cantor Fitzgerald initiated coverage of Health Catalyst (HCAT) with an Overweight rating and $16 price target. The firm sees several underappreciated growth levers on the horizon that could enable Health Catalyst to achieve its long-term target of 20% revenue growth and is more optimistic than consensus about a return to a normal pipeline following conversations with large payors/providers that indicate margin compression at its clients could be coming to an end. (Read more)
• R.F. Lafferty initiated coverage of Polestar Automotive (PSNY) with a Buy rating and $9 price target. The Scandinavian designer of luxury high-performance electric vehicles is targeting 60,000 to 70,000 customer deliveries for 2023. (Read more)