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:
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Evercore ISI upgraded Southwest (LUV) to Outperform from In Line with a price target of $35, up from $30. The firm cites the “long-awaited” transition to capacity discipline, new revenue initiatives to be outlined at the company’s upcoming investor day on September 26 – including assigned seating and premium economy – as well as strong underlying fleet value.
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Exane BNP Paribas upgraded Visa (V) to Outperform from Neutral with a $325 price target. The firm says cash digitization has largely played out in the U.S., leaving Visa and MasterCard to compete for potentially limited opportunities in other regions, particularly in Europe.
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Deutsche Bank upgraded Wells Fargo (WFC) to Buy from Hold with a $65 price target. The stock’s recent weakness has created a better entry point, the firm tells investors in a research note. Deutsche Bank also upgraded Bank of America (BAC) to Buy from Hold with a $45 price target.
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HSBC upgraded Autodesk (ADSK) to Buy from Hold with a price target of $299, up from $242. The company’s Q2 profit was well above forecasts, and it is gaining market share in key segments as customers increasingly consolidate into its comprehensive end-to-end platform as opposed to competing siloed systems, the firm tells investors in a research note. Goldman Sachs also upgraded Autodesk to Neutral from Sell with a price target of $295, up from $225.
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Morgan Stanley upgraded Unity Software (U) to Overweight from Equal Weight with an unchanged price target of $22. Following the cut to 2024 guidance at the Q2 results, the firm now views forward estimates for Unity as “derisked.”
Top 5 Downgrades:
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Wells Fargo downgraded Boeing (BA) to Underweight from Equal Weight with a price target of $119, down from $185. The firm sees the company’s free cash flow peaking by 2027 as aircraft development costs offset further production growth, and says an equity raise likely further dilutes the shares.
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Deutsche Bank downgraded JPMorgan (JPM) to Hold from Buy with a $235 price target. The firm notes shares have been the best performing bank stock it covers, with Deutsche now seeing less upside to JPMorgan in the near- and medium-term as “a lot of good news seem priced in.”
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Exane BNP Paribas downgraded MasterCard (MA) to Neutral from Outperform with a $470 price target. The firm now expects MasterCard’s revenue growth to slow versus Visa’s.
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BofA downgraded CME Group (CME) to Underperform from Neutral with a price target of $177, down from $212, citing intensifying competition. CME now faces a battle on three fronts with BGC Partners (BGC), Cboe Global Markets (CBOE) and IntercontinentalExchange (ICE) and the competition could lead to market share losses and pricing headwinds, the firm tells investors.
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TD Cowen downgraded Xylem (XYL) to Hold from Buy with an unchanged price target of $138. While the company’s core municipal markets should remain firm, near-term estimates lack upside and the company’s revenue and margin trends are decelerating, the firm tells investors in a research note.
Top 5 Initiations:
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Morgan Stanley initiated coverage of HCA Healthcare (HCA) with an Equal Weight rating and $427 price target. The firm is bullish on HCA’s fundamentals and views its “bellwether status” within the hospital group as warranted, but is taking a “measured approach on the stock” following the significant outperformance.
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Leerink initiated coverage of Penumbra (PEN) with an Outperform rating and $263 price target. Leerink believes Penumbra has recently captured relatively significant market share in venous thromboembolism, which represents the largest component of the company’s U.S. Thrombectomy sales and includes both deep vein thrombosis and pulmonary embolism.
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Leerink initiated coverage of Inari Medical (NARI) with a Market Perform rating and $47 price target. The firm says that with mechanical thrombectomy “still in the early stages of adoption more broadly,” Inari’s near-term growth in venous thromboembolism “currently remains relatively sensitive to ongoing competitive dynamics.”
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Leerink initiated coverage of 10x Genomics (TXG) with an Outperform rating and $35 price target. The firm notes 10x Genomics is the leader in the single-cell market, which accounts for about 70% of product sales, but says it believes the company’s outlook now depends on its Spatial business as researchers add the spatial context to gain biological insights.
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Goldman Sachs initiated coverage of MKS Instruments (MKSI) with a Neutral rating and $129 price target. While encouraged by the growth outlook for the company’s semiconductor business, underpinned by technology inflections in logic and memory, the firm sees a relatively balanced risk/reward profile for the stock at current levels.