Estee Lauder upgrade, Block downgrade and Jack in the Box initiation among today’s top calls on Wall Street
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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:
- Goldman Sachs analyst Jason English upgraded Estee Lauder (EL) to Buy from Neutral with a price target of $303, up from $298. The duration of China’s zero-COVID policy and the associated impact on the company’s business remains high, but after the derating in the stock, these headwinds are now "adequately reflected" in the valuation, the analyst told investors in a research note.
- Barclays analyst Tim Long upgraded Arista Networks (ANET) to Overweight from Equal Weight with an unchanged price target of $131. The analyst believes Arista’s mid-teens growth rate should be sustainable for a few more years.
- JPMorgan analyst John Royall upgraded PBF Energy (PBF) to Overweight from Neutral with an unchanged price target of $43. The shares have traded off 32% since their peak, with current levels "highly attractive" given improvements in the company’s balance sheet.
- Citi analyst Paul Lejuez upgraded Oxford Industries (OXM) to Neutral from Sell with a price target of $105, up from $92. The analyst continues to see risk to margins longer-term, but says "it is unclear when this will materialize."
- Canaccord analyst Matt Bottomley upgraded Aurora Cannabis (ACB) to Hold from Sell with a price target of C$2, down from C$2.50, post the fiscal fourth quarter results.
Top 5 Downgrades:
- SMBC Nikko analyst Andrew Bauch downgraded Block (SQ) to Neutral from Outperform with a price target of $70, down from $120. The analyst cited the company’s "hard-to-quantify, but material" crypto exposure, lack of medium-term visibility, and uncertainty around the potential impact of its "more conservative" investment strategy on medium-term growth for the downgrade.
- Mizuho analyst Vijay Rakesh downgraded Micron Technology (MU) and Western Digital (WDC) to Neutral from Buy with price targets of $56 and $40, respectively. Recent checks show "steepening" DRAM and NAND memory price declines price declines into the December quarter and first half of 2023, Rakesh told investors in a research note.
- Barclays analyst Tim Long downgraded Cisco Systems (CSCO) to Equal Weight from Overweight with a price target of $46, down from $56. While Cisco has doubled its relative share in cloud from 2019 to 2021, the business has since stalled, Long noted.
- Canaccord analyst Maria Ripps downgraded Stitch Fix (SFIX) to Hold from Buy with a price target of $7, down from $12. The company reported "soft" fourth quarter results, with active clients, revenue, and adjusted EBITDA all coming in below consensus as demand was impacted by the challenging macroeconomic environment and lower retail spend, Ripps noted.
- JPMorgan analyst Casey Woodring double downgraded Sotera Health (SHC) to Underweight from Overweight with a price target of $9, down from $26, following Monday’s "disappointing verdict" in the company’s first trial alleging improper emissions of carcinogenic ethylene oxide.
Top 5 Initiations:
- Wolfe Research analyst Greg Badishkanian initiated coverage of Jack in the Box (JACK) with a Peer Perform rating and no price target. While the company’s franchisee relations have improved in recent years, the bar for accelerating unit growth is high and Jack also faces a challenging operating environment in California, Badishkanian contended.
- Wolfe Research analyst Greg Badishkanian initiated coverage of RumbleON (RMBL) with a Peer Perform rating and no price target. The analyst thinks the company’s gross profit per unit could see pressure as inventories normalize.
- Jefferies analyst Corey Grady initiated coverage of Trupanion (TRUP) with a Buy rating and $77 price target. The long-term revenue target "looks conservative" for the "industry leader" in North America for medical insurance for cats and dogs given that the North American pet insurance industry is a $2B-$3B market growing at a 25% five-year CAGR with 2-3% penetration and Trupanion has 25% market share, Grady told investors.
- JPMorgan analyst Brian Cheng initiated coverage of Intellia Therapeutics (NTLA) with an Overweight rating and $85 price target. The analyst also added Intellia to the firm’s U.S. Analyst Focus List as a Growth idea. Additionally, Cheng initiated Xencor (XNCR) with an Overweight rating, Gossamer Bio (GOSS) with a Neutral and ADC Therapeutics (ADCT) with an Underweight.
- Capital One analyst Zegbeh Jallah initiated coverage of Rapt Therapeutics (RAPT) with an Overweight rating and $48 price target. The analyst views RPT193 as a potential "multi-billion-dollar" oral drug for atopic dermatitis, asthma, and other inflammatory diseases.
Keywords: analyst, analyst calls, upgrades, downgrades, initiations, research, wall street
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