This Week, From The Analyst Community

Stock analysts can provide valuable insight into the sentiment around a certain stock or sector and shed some light on what is possible or likely for a stock.  Stirrings in the analyst community can sometimes be early signs of stock movement.  Which is why our team reviews dozens of analyst research reports each and every day with the goal of finding new investment ideas for our readers. 

Of the hundreds of reports we reference weekly, some stand out among the others for various reasons.  Our team has sifted through this week’s reports and whittled it down to the most pertinent moves.   

Read on for the details on some of the most impactful actions taken by brokerage firms over the past week.   

Monday, May 2nd

  • Cowen analyst Jonna Kim upgraded Bath & Body Works (BBWI) to Outperform from Market Perform with an $82 price target after taking over coverage of the name. The analyst likes the company’s growth prospects relative to the stock’s valuation and “long-term advantages” based on its product innovation, customer retention, and “efficient” marketing spend.
  • Piper Sandler analyst R. Scott Siefers downgraded KeyCorp (KEY) to Underweight from Neutral with a price target of $20.50, down from $23. Among the large regionals, KeyCorp’s uncertainty around the degree of fee recovery that may be required to meet expectations could limit the stock, especially within the context of a macro environment that “seems only to be getting more uncertain,” Siefers told investors in a research note.
  • Piper Sandler analyst Alexander Twerdahl downgraded Community Bank System (CBU) to Underweight from Neutral with a price target of $66, down from $74. The analyst sees “several headwinds on the horizon” that could dampen earnings growth for Community Bank.

Tuesday, May 3rd

  • Morgan Stanley analyst Matthew Harrison upgraded Vertex Pharmaceuticals (VRTX) to Equal Weight from Underweight with a price target of $250, up from $222. The risk/reward for Vertex is “skewed more favorably” post AbbVie’s (ABBV) failure with its ABBV-119 triplet program in cystic fibrosis, said Harrison, who thinks the company’s long-term cash flow profile likely to maintain premium valuation in the current market environment.
  • Wedbush analyst Daniel Ives downgraded DocuSign (DOCU) to Underperform from Neutral with a price target of $60, down from $80. The analyst believes the work from home beneficiary could see difficult growth ahead not factored into shares at current prices. Ives also downgraded (AI) and Matterport (MTTR) to Neutral from Outperform.
  • Morgan Stanley analyst Joseph Moore resumed coverage of Nvidia (NVDA) with an Equal Weight rating and $217 price target. While Nvidia remains one of the best growth names in the semiconductor space, the analyst is concerned about deceleration in gaming and the stock’s high valuation versus peers.
  • JPMorgan analyst Joseph Greff reinstated coverage of MGM Resorts (MGM) with an Overweight rating and $53 price target following a period of restriction. The analyst likes the 15% pullback to the low $40s share price levels to play for a continued recovery in Las Vegas, where he says hotel pricing remains strong.

Wednesday, May 4th

  • Evercore ISI analyst David Palmer upgraded Starbucks (SBUX) to Outperform from In Line with an unchanged price target of $95. The analyst has less fear of a big investment year in fiscal 2023 following earnings results.
  • Susquehanna analyst Shyam Patil downgraded Lyft (LYFT) to Neutral from Positive with a price target of $25, down from $54, citing a belief that the softer near-term outlook, need to increase investments, and macro headwinds are likely to weigh on shares in the near-term.
  • Morgan Stanley analyst Adam Jonas downgraded Carvana (CVNA) to Equal Weight from Overweight with a price target of $105, down from $360. While he sees Carvana as “a good company” with an established infrastructure network designed for the future of electric and connected mobility, the company admits it had accelerated growth at precisely the wrong time into a consumer slowdown, leaving a major mismatch between capacity and demand and creating a liquidity crunch.

Thursday, May 5th

  • Mizuho analyst Gregg Moskowitz upgraded Fortinet (FTNT) to Buy from Neutral with a price target of $350, up from $340. The company reported “another very good upside quarter,” led by bookings growth of 50% year-over-year and product revenue growth of 54%, Moskowitz told investors in a research note.
  • Argus analyst Jim Kelleher downgraded Twitter (TWTR) to Hold from Buy. The analyst cited the approval by the company’s board to be taken private by Elon Musk.
  • Argus analyst David Toung downgraded Teladoc (TDOC) to Hold from Buy. The company is facing increased competition in the direct-to-consumer market for behavioral health services, and paying more to acquire new members, the analyst noted.
  • Bank of America analyst Robert Ohmes double downgraded Sprouts Farmers Market (SFM) to Underperform from Buy with a price target of $25, down from $40. The company’s new outlook calls for double digit percent cost inflation and price increases to continue for the balance of 2022 versus a previous expectation of easing inflation, Ohmes pointed out.

Friday, May 6th

  • Roth Capital analyst Darren Aftahi downgraded FuboTV (FUBO) to Neutral from Buy with a price target of $4.25, down from $7.50, post the Q1 results. The cost of the company’s subscriber base is yet to be offset by better advertising, Aftahi tells investors in a research note. FuboTV’s advertising revenue revenue came in 19% lower, and while some of those headwinds were macro-related and a delay in its new ad tech stack, it marked the second quarter of ad average revenue per user compression, says the analyst. JPMorgan analyst Philip Cusick also downgraded FuboTV to Underweight from Neutral without a price target post the Q1 results.
  • Piper Sandler analyst Peter Keith last night downgraded Wayfair (W) to Neutral from Overweight with a price target of $65, down from $200. The analyst says he can no longer defend shares as the sales outlook and market share dynamics are uncertain.

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