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.
Tuesday, May 31st
- Wells Fargo analyst Ned Baramov downgraded Sunoco LP (SUN) to Underweight from Equal Weight with a price target of $41, down from $46. While the demand elasticity threshold of $4.50 is not exact, and fuel distribution volumes/margins could in theory continue unabated even at higher gasoline prices, the analyst believes the risk-reward is unfavorably skewed at current levels.
- Morgan Stanley analyst Kimberly Greenberger downgraded American Eagle (AEO) to Underweight from Equal Weight with a price target of $8, down from $22. The company cut its 2022 guidance “significantly as its optimism proved excessive,” said the analyst, who sees room for further material downside as the second half of 2022 guide “appears unachievable.”
- Argus analyst Kevin Heal downgraded Rocket Companies (RKT) to Hold from Buy. The analyst cited “significantly higher” mortgage rates as 30-year fixed rate moved above 5% and is expected to remain elevated in light of the well-publicized accelerated rate hikes by the Federal Reserve, adding that the company’s origination volumes are expected to drop 50% from 2021 levels.
Wednesday, June 1st
- Atlantic Equities analyst James Mainwaring downgraded Medtronic (MDT) to Neutral from Overweight with a price target of $105, down from $125. The company “continues to be stuck in a negative earnings revision cycle” following the fourth quarter miss despite management trying to set conservative guidance in recent quarters, Mainwaring told investors in a research note.
- JMP Securities analyst Nicholas Jones initiated coverage of Etsy (ETSY) with an Outperform rating with an unchanged price target of $125. The analyst views its increase in brand awareness “as lasting as opposed to transitory” and sees plenty of opportunity for the company to continue driving volume growth. The analyst also assumed coverage of Amazon.com (AMZN) with an Outperform rating and price target of $3,450, down from $3,600.
- JMP Securities analyst Nicholas Jones resumed coverage of eBay (EBAY) with a Market Perform rating and no price target. The analyst views eBay’s strategic focus on enthusiasts and focus categories favorably, but looks for near-term trends at the company to begin moving toward its long-term vision to become more positive on the name.
Thursday,June 2nd
- Oppenheimer analyst Colin Rusch upgraded SolarEdge (SEDG) to Outperform from Perform with a $334 price target as he finds it demonstrating a highly defensible technology position poised for outsized growth despite trading at levels with a compelling risk/reward profile. He believes the global solar industry will grow 3-5-times over the next decade and that SolarEdge will be a key beneficiary, enjoying easing supply headwinds and incremental operating leverage.
- Piper Sandler analyst Thomas Champion downgraded Snap (SNAP) to Neutral from Overweight with a price target of $18, down from $30. Champion is concerned about Snap in a worsening market. He also downgraded Pinterest (PINS) to Neutral from Overweight with a price target of $23, down from $35.
Friday, June 3rd
- B. Riley analyst Dave Kang upgraded Ciena (CIEN) to Buy from Neutral with a price target of $67, up from $65, post the fiscal Q2 results. The shares are down 35% year-to-date “despite strong demand and visibility,” Kang tells investors in a research note. While the global supply chain headwinds are limiting Ciena’s revenue growth near-term, both its revenues and margins will eventually reflect the strong demand environment as the supply chain situation eases over the next several quarters, contends the analyst.
- Piper Sandler analyst Harsh Kumar downgraded Micron Technology (MU) to Underweight from Neutral with a price target of $70, down from $90. The downgrade is due to the company’s “oversized exposure” to mobile, PCs, and other consumer end markets and the associated trends in the macroeconomy, Kumar tells investors in a research note.
- Raymond James analyst Simon Leopold initiated coverage of Snowflake (SNOW) with an Outperform rating and $184 price target. The company’s differentiation in cloud data warehouse enables it to compete against cloud-agnostic and public cloud options, Leopold tells investors in a research note.
- William Blair analyst Cristopher Kennedy assumed coverage of LendingTree (TREE) with an Outperform rating and no price target. The stock’s 51% decline year-to-date largely reflects the macro pressures tied to the mortgage market and creates an attractive risk/reward, Kennedy tells investors in a research note.
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