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.
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 analysts over the past week.
Monday, September 26th
- Oppenheimer analyst Jason Helfstein upgraded Netflix (NFLX) to Outperform from Perform with a $325 price target after assuming coverage of the name. The company’s advertising tier launch should accelerate subscriber growth, drive average revenue per user, and slow churn, Helfstein told investors in a research note.
- Wells Fargo analyst Michael Turrin downgraded Adobe (ADBE) to Equal Weight from Overweight with a price target of $310, down from $425. The analyst expects investor questions around slowing growth/increasing competition on the digital media side of the business to only intensify, especially given third quarter results and fourth quarter guidance suggest price increases aren’t providing as much of an offset as anticipated. Edward Jones analyst Logan Purk also downgraded Adobe to Hold from Buy.
- Susquehanna analyst Mehdi Hosseini downgraded NetApp (NTAP) to Neutral from Positive with a price target of $75, down from $100, as he lowered his rating on the Enterprise Hardware sector given his view that they will continue to underperform in 2023 due to lack of confidence and a lack of a catalyst for a recovery. The analyst also downgraded Super Micro Computer (SMCI) to Neutral from Positive with a price target of $55, down from $88.
- Compass Point analyst Jason Weaver initiated coverage of Zillow Group (ZG; Z) with a Buy rating and $50 price target. While customer demand is generally correlated to overall real estate market conditions that are expected to remain under pressure through mid-2023, the “challenge and opportunity” for Zillow to actively capture share holds potential growth implications that may far offset near-term market headwinds, the analyst said.
Tuesday, September 27th
- Redburn analyst Russell Quelch upgraded Morningstar (MORN) to Buy from Neutral with a $350 fair value estimate. The analyst sees the business being “well positioned to weather a downturn” given its heavy subscription-based revenue streams, strong pricing power and high levels of product innovation. He forecasts margins to trough in 2022 and argues that the valuation for the provider of Data & Analytics solutions to the financial services industry “looks attractive on a range of metrics.”
- Susquehanna analyst James Friedman downgraded PayPal (PYPL) to Neutral from Positive with a price target of $100, down from $115. Braintree is quickly gaining share within PayPal’s total payment volume, “creating negative leverage from mix,” Friedman told investors in a research note.
- Barclays analyst Adrienne Yih downgraded Nike (NKE) to Equal Weight from Overweight with a price target of $110, down from $125. The analyst cited her “bearish” wholesale sector demand risk thesis, continued volatility in China, excess North America inventory bringing heightened operating risk and currency headwinds, primarily in Europe.
- JPMorgan analyst Samik Chatterjee initiated coverage of Luminar Technologies (LAZR) with an Overweight rating and $30 price target. The analyst forecasts Luminar will exit the decade with the strongest revenue amongst the peer group despite a smaller order book relative to Innoviz (INVZ) currently.
Wednesday, September 28th
- 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.
- 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.
Thursday, September 29th
- Mizuho analyst Dan Dolev downgraded Block (SQ) to Neutral from Buy with a price target of $57, down from $125. After years of rightfully being deemed the most innovative name in payments, “user fatigue, plateauing inflows, loss of the best-of-breed” point of sale status, and buy now pay later “misexecution” are blocking Block’s growth, Dolev told investors in a research note.
- MoffettNathanson analyst Jackson Ader initiated coverage of DocuSign (DOCU) with an Underperform rating and $58 price target for December 2023. While he tells investors that he does not expect the macro environment to hit DocuSign particularly harder than others, he expects that navigating the macro environment will be more difficult than at peers given all the disruption in the organization with sales and operations leadership being brand new in a bunch of key areas. Ader also started coverage of LegalZoom (LZ) with an Underperform rating and $11 price target.
- MoffettNathanson analyst Jackson Ader initiated coverage of Monday.com (MNDY) with an Outperform rating and $170 price target. The analyst is a believer in the collaboration and work management software space.
- RBC Capital analyst Piral Dadhania initiated coverage of Nike (NKE) with an Outperform rating and $125 price target. The analyst views recover in China as the catalyst to improve investors sentiment, which he says is showing early signs of promise.
Friday, September 30th
- BMO Capital analyst Andrew Strelzik upgraded Domino’s Pizza (DPZ) to Outperform from Market Perform with an unchanged price target of $430. Against the backdrop of lowered near-term expectations, the stock offers an attractive risk/reward.
- UBS analyst Brennan Hawken downgraded Evercore (EVR) to Sell from Neutral with a price target of $85, down from $99. The analyst warns that the company’s shrinking deal pipeline increases the risk of inflexibility in their expense, which he believes is not being fully captured by consensus estimates.
Credit Suisse analyst Fred Lee initiated coverage of Zoom Video(ZM) with a Neutral rating and $83 price target. Zoom has the most significant risk in his coverage universe in both directions, and while it is in the very early innings of its enterprise telephony ramp, 45% of revenues today consist of low-touch online, predominantly consumer, business, Lee tells investors in a research note.
