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Street Wrap: Today’s Top 15 Upgrades, Downgrades, Initiations

MongoDB upgrade, Carvana downgrades, and Five Below coverage resumption 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:

  • JMP Securities analyst Patrick Walravens upgraded MongoDB (MDB) to Outperform from Market Perform with a $215 price target. The company delivered much better-than-expected Q3 results as it saw a rebound in Atlas consumption, particularly in areas that were below expectations in Q2, and continues to see "a healthy environment for new business," Walravens tells investors in a research note.
  • BofA analyst Julien Dumoulin-Smith upgraded SolarEdge (SEDG) to Buy from Neutral with a price target of $367, up from $269, telling investors that the company provided a line of sight at the firm’s Renewables Conference to a better outlook than he believes is appreciated by the Street.
  • Argus analyst David Coleman upgraded Allscripts (MDRX) to Buy from Hold with a $26 price target. The company’s cloud-based solutions have helped to meet the changing needs of patients and healthcare providers during the pandemic, and its increasing margins should continue to benefit from its fast-growing Veradigm business, the analyst tells investors in a research note.
  • Raymond James analyst Patrick O’Shaughnessy upgraded Tradeweb Markets (TW) to Outperform from Market Perform with a $74 price target. The analyst believes Tradeweb can achieve "solid growth results in a variety of macroeconomic conditions" and that its "underlying strength has been somewhat masked recently by forex headwinds."
  • Guggenheim analyst Jack Wallace upgraded R1 RCM (RCM) to Buy from Neutral with a $15 price target. His prior Neutral rating reflected his view that Street estimates for fiscal 2023 were too high, but since the Q3 report those "conditions have changed" and he now believes there is "more potential upside than downside" to 2023 estimates when RCM gives initial guidance in January.

Top 5 Downgrades:

  • Wedbush analyst Seth Basham downgraded Carvana (CVNA) to Underperform from Neutral with a price target of $1, down from $9. The analyst believes recent developments indicate a higher likelihood of debt restructuring that could leave the equity worthless in a bankruptcy scenario, or highly diluted in a best case. William Blair analyst Sharon Zackfia also downgraded Carvana to Market Perform from Outperform following news that about 70% of Carvana’s debt holders are banning together for negotiations, which she reads as a sign that Carvana’s "cash crunch is worsening."
  • Morgan Stanley analyst Brian Nowak downgraded Airbnb (ABNB) to Underweight from Equal Weight with a price target of $80, down from $110. Active listings have grown at a 12% CAGR from 2018-2022, but he sees this slowing to a 7% CAGR in 2022-2025 due to scale and the "law of large numbers," said Nowak, who argues that slowing supply creates an occupancy headwind and lower forward room night demand.
  • Wolfe Research analyst Deepak Mathivanan downgraded Shopify (SHOP) to Peer Perform from Outperform without a price target. Given the high penetration, e-commerce growth is likely to show high sensitivity to retail sales and consumer spending trends during the macroeconomic slowdown in 2023, Mathivanan tells investors in a research note. The analyst also downgraded Chewy (CHWY) and Booking Holdings (BKNG) to Peer Perform from Outperform.
  • Wolfe Research analyst Deepak Mathivanan downgraded Expedia (EXPE) and TripAdvisor (TRIP) to Underperform from Peer Perform with price targets of $85 and $17, respectively. Travel demand is likely to moderate amid the macroeconomic slowdown in 2023 and consensus estimates do not appear to reflect the magnitude accurately, Mathivanan tells investors in a research note.
  • Raymond James analyst David Long downgraded Signature Bank (SBNY) to Market Perform from Strong Buy. While he remains bullish on the bank’s long-term prospects to produce superior loan growth, operating efficiency, and credit metrics, the analyst sees near-to intermediate-term headwinds related to its balance sheet initiatives.

Top 5 Initiations:

  • William Blair analyst Phillip Blee resumed coverage of Five Below (FIVE) with an Outperform rating and no price target. The company reported results for Q3 with both sales and earnings above the Street’s expectations and management’s prior guide, Blee tells investors in a research note.
  • Loop Capital analyst Scott Graham initiated coverage of Applied Materials (AMAT) with a Buy rating and $125 price target. The company’s Semiconductor sales should outperform the overall WFE capex, both during the current downturn and when capex turns positive again in Q3 of fiscal 2024, the analyst tells investors in a research note.
  • RBC Capital analyst Conor McNamara initiated coverage of Thermo Fisher (TMO) with an Outperform rating and $661 price target. He sees the company becoming "a one-stop-shop for future biopharma research and drug development" by combining their historical assets in life science research with recent acquisitions in the CDMO, CRO, and diagnostics spaces. The analyst also started coverage of Illumina (ILMN) with an Outperform rating and a price target of $282.
  • William Blair analyst Myles Minter initiated coverage of Argenx (ARGX) with an Outperform rating and $460.66 fair value estimate. The analyst believes Vyvgart is a "best-in-class product with a first-mover advantage over peers."
  • JPMorgan analyst Eric Joseph initiated coverage of Pliant Therapeutics (PLRX) with an Overweight rating and $42 price target. The analyst believes current Pliant share levels "imply rather conservative success assumptions."
Keywords: analyst, analyst calls, upgrades, downgrades, initiations, research, wall street

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