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, July 18th

  • Goldman Sachs analyst Jared Garber double upgraded Yum! Brands (YUM) to Buy from Sell with a price target of $135, up from $125. The company’s “highly-franchised model provides relative insulation” from the macro volatility, Garber told investors in a research note.
  • Berenberg analyst Peter Richardson upgraded JPMorgan (JPM) to Hold from Sell with an unchanged price target of $120. JPMorgan is operating in a difficult environment but its shares are now trading at a 20% discount to their long-run average, Richardson argued.
  • Deutsche Bank analyst Emmanuel Rosner downgraded General Motors (GM) to Hold from Buy with a price target of $36, down from $57, on growing earnings risk. The analyst also downgraded Goodyear Tire (GT) to Hold from Buy with a price target of $15, down from $19.
  • Mizuho analyst John Baumgartner initiated coverage of Kraft Heinz (KHC) with a Buy rating and $48 price target. The analyst believes the Street continues to underestimate and undervalue the company’s growth potential.

Tuesday, July 19th

  • Vertical Group downgraded Disney (DIS) to Mixed from Positive, citing concerns about a spending slowdown for national TV advertising. The firm also downgraded Comcast (CMCSA) and Paramount (PARA) to Mixed from Positive.
  • Evercore ISI analyst Amit Daryanani downgraded HP Inc. (HPQ) to In Line from Outperform with a price target of $36, down from $43, citing his view that PC market headwinds “could get more severe.”
  • JMP Securities analyst Andrew Boone initiated coverage of Shopify (SHOP) with a Market Perform rating and no price target. Shopify is entering a “major investment cycle” as it offers fulfillment services to merchants, which will limit its margin expansion and free cash flow generation, Boone told investors in a research note.
  • Macquarie analyst Esme Pau initiated coverage of NetEase (NTES) with an Outperform rating and $129 price target. Pau said the resumption of game approvals in China in the second quarter should revive the growth visibility of the domestic game market in the China online game sector, which should boost the sector’s growth outlook and leads her to think “re-ratings are about to begin” in the space.
  • Evercore ISI analyst James Ratcliffe initiated coverage of Momentus (MNTS) with an Underperform rating and $2 price target. While admitting that Momentus’s Vigoride platform could fill a need in “a potentially rapidly growing satellite launch market,” Ratcliffe is cautious given that the company’s Vigoride spacecraft and MET thruster have not yet been successfully tested in orbit, the company will need significant additional capital by mid-2023 and the demand environment looks “promising” but “remains highly uncertain.”

Wednesday, July 20th

  • Atlantic Equities analyst Simon Clinch downgraded Coinbase (COIN) to Neutral from Overweight with a price target of $54, down from $95, citing incremental concerns for the company and the crypto economy in the near- to medium-term.
  • Argus analyst John Staszak downgraded McCormick (MCK) to Hold from Buy. The downgrade reflects McCormick’s high input costs and modest earnings prospects over the next year, as well as the stock’s relatively high valuation, Staszak told investors in a research note.
  • BMO Capital analyst Matt Borsch downgraded Universal Health (UHS) to Underperform from Market Perform with a price target of $90, down from $133, following last week’s warning of lower second quarter and full year 22 earnings. The analyst also downgraded HCA Healthcare (HCA) to Underperform from Market Perform with a $160 price target, down from $233.

Thursday, July 21st

  • JPMorgan analyst Thomas Palmer upgraded Bunge (BG) to Overweight from Neutral with a price target of $106, down from $130, which represents 25% upside from current levels. The analyst thinks near-term positive catalysts could come from the company’s second quarter earnings and a rebound in agriculture products trends.
  • Argus analyst John Staszak downgraded United Airlines (UAL) to Hold from Buy and he is lowering his EPS estimates to reflect flight cancellations, pilot shortages and higher fuel prices. Meanwhile, Exane BNP Paribas analyst James Hollins downgraded United Airlines to Underperform from Neutral with a price target of $33, down from $38.
  • Bank of America analyst Lorraine Hutchinson downgraded Kohl’s (KSS) to Underperform from Neutral with a price target of $26, down from $50. Her rating is now aligned with her negative view on the department store industry, said Hutchinson, who previously had been concerned about fundamentals but held a neutral view on the stock given the possibility of a takeout.
  • Needham analyst Ryan MacDonald initiated coverage of Duolingo (DUOL) with a Buy rating and $115 price target. The analyst’s survey work shows that Duolingo has built “industry-leading brand recognition with a gamified learning platform that draws learners in and generates stronger engagement than that of comparable businesses in ed tech.”
  • Canaccord analyst Kingsley Crane initiated coverage of Datadog (DDOG) with a Hold rating and $120 price target. While he likes Datadog’s underlying platform architecture and prospects to grow in the logging market, Crane sees “little margin for error” given the stock’s current valuation.

Friday, July 22nd

  • Argus analyst John Staszak downgraded American Airlines (AAL) to Hold from Buy. The downgrade reflects the company’s high debt relative to other legacy airlines and concerns Staszak has about the extent to which American Airlines can reduce its leverage, the analyst tells investors in a research note. Higher pilot salaries and high fuel prices are likely to hinder free cash flow and debt reduction, he adds.
  • Wedbush analyst Matt Bryson upgraded Diebold (DBD) to Outperform from Neutral with an unchanged price target of $5, citing his belief that sales and earnings are positioned to improve through 2022 into 2023 regardless of broader macro trends.
  • Cowen analyst Gautam Khanna upgraded Lennox (LII) to Outperform from Market Perform with a price target of $260, down from $295. The stock is “oversold” as the valuation has de-rated by over 25% since the start of this year, despite no cuts to Street estimates, while Lennox also had company-specific overhangs that are abating, Khanna tells investors.

Should you invest in Kraft Heinz right now?

Before you consider buying Kraft Heinz, you'll want to see this.

Investing legend, Keith Kohl just revealed his #1 stock for 2022...

And it's not Kraft Heinz.

Jeff Bezos, Peter Thiel, and the Rockefellers are betting a colossal nine figures on this tiny company that trades publicly for $5.

Keith say’s he thinks investors will be able to turn a small $50 stake into $150,000.

Find that to be extraordinary?

Click here to watch his presentation, and decide for yourself...

But you have to act now, because a catalyst coming in a few weeks is set to take this company mainstream... And by then, it could be too late.

Click here to find out the name and ticker of Keith's #1 pick...