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

Roku double upgrade, Canada Goose downgrade, and Kimberly-Clark initiation among today’s top calls on Wall Street

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Check out today’s top analyst calls from around Wall Street:

Top 5 Upgrades:

• BofA upgraded Roku (ROKU) to Buy from Underperform with a price target of $85, up from $45. The company is performing better than the broader advertising market, which remains weak, as ad spending across some verticals is bottoming out, the analyst tells investors. [read more]

• Citi upgraded TechnipFMC (FTI) to Buy from Neutral with an $18 price target after taking over coverage of the name. The company’s pricing leverage is improving given a consolidating sector and success of its integrated model and standardization strategy, the analyst tells investors. [read more]

• BTIG upgraded DraftKings (DKNG) to Buy from Neutral with a $24 price target. A divergence in player adoption and marketing cost trends has driven upside versus EBITDA expectations for DraftKings throughout 2022, and this pattern will persist in 2023, the analyst said. [read more]

• Wolfe Research upgraded Virgin Galactic (SPCE) to Peer Perform from Underperform without a price target. With WhiteKightTwo’s return to flight, Virgin Galactic shares will "likely link to a positive event path" through June, the analyst tells investors. [read more]

• Compass Point upgraded Coinbase (COIN) to Buy from Neutral with a price target of $100, up from $75, after updating estimates ahead of the company’s Q4 earnings report due on February 21. The firm believes Coinbase is well positioned to gain market share when the crypto bull market returns. [read more]

Top 5 Downgrades:

• Evercore ISI downgraded Canada Goose (GOOS) to In Line from Outperform with a price target of $20, down from $25. The analyst views the company’s new long-term financial targets, which promise to nearly triple sales to $3B in five years while taking EBIT margin from 19% currently to 30%, as "needlessly aggressive." [read more]

• Raymond James downgraded Axon (AXON) to Outperform from Strong Buy with a $223 price target. Shares are up 130% from their lows in May 2022, and while execution has been nearly flawless during this period, the inevitability of mean reversion, decelerating growth off of a larger base and less room for multiple expansion leave the firm searching for a near-term positive catalyst. [read more]

• Stifel downgraded Texas Roadhouse (TXRH) to Hold from Buy with a price target of $105, down from $110. The analyst remains confident in the company’s 2023 sales outlook and long-term unit growth prospects, but is less confident there is meaningful upside to its 2023 earnings per share estimate. [read more]

• B. Riley downgraded Universal Electronics (UEIC) to Neutral from Buy with a price target of $22, down from $29, following the Q4 miss. The company’s legacy home entertainment segment has substantially accelerated the pace of decline, thereby deferring the growing home automation, security and hospitality segment’s ability to begin to offset that decline, the analyst tells investors. [read more] The stock was also downgraded to Neutral from Buy at Rosenblatt. [read more]

• Credit Suisse downgraded XP Inc. (XP) to Underperform from Neutral with a price target of $15, down from $27, after the company’s Q4 results missed expectations. The analyst believes it is time for a shift in strategy at the company, saying the results are "very negative" for shares given the large earnings decline. [read more]

Top 5 Initiations:

• Citi initiated coverage of Kimberly-Clark (KMB) with a Sell rating and $120 price target. The analyst forecasts "peer-low" growth at Kimberly-Clark given its exposure to lower growth country/category combinations.  [read more] The initiation was one of 16 companies in the U.S. beverages and household products and personal care space. [read more]

• Credit Suisse initiated coverage of Wix.com (WIX) with an Outperform rating and $105 price target. As a leading software-as-a-service content management system provider, Wix offers a compelling suite of no/low-code web development tools and has also built out a "robust suite" of business and commerce solutions, the analyst argues. [read more]

• Mizuho initiated coverage of GE HealthCare (GEHC) with a Buy rating and $90 price target. The analyst says positive feedback from the firm’s radiology survey points to pent-up demand for additional U.S. hospital imaging capacity. Positive checks from hospital surveys point toward a return to double-digit growth in imaging procedures, the analyst added. [read more]

• DA Davidson initiated coverage of Braze (BRZE) with a Neutral rating and $34 price target. While stating they have "a very positive outlook" for Braze and view it as a leader in the emerging customer engagement software arena, the firm believes the possible rationalization of marketing budgets this year is a reason for "a little near term caution." [read more]

• Morgan Stanley assumed coverage of Zebra Technologies (ZBRA) with an Equal Weight rating with a price target of $305, up from $260. The firm is increasing estimates to credit the company’s Q1 beat, but still sees risks around growing macro caution and lingering supply chain issues. [read more]

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