Kymera upgraded, MoonLake downgraded: Wall Street’s top analyst calls

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:

• Wolfe Research upgraded Kymera Therapeutics (KYMR) to Outperform from Peer Perform with a $65 price target. The timing of STAT6 readout in 2025 is closer and the stock has “became safer to trade” now that IRAK4 catalysts are delayed, the analyst tells investors.
• UBS upgraded PTC Therapeutics (PTCT) to Buy from Neutral with a $47 price target after resuming coverage of the name. With multiple new drug application filings this year and potential commercial launches next year along with upcoming clinical catalysts, there is upside potential for the shares, the analyst tells investors
• Gordon Haskett upgraded Ollie’s Bargain Outlet (OLLI) to Buy from Accumulate with a price target of $107, up from $105. The firm cites “a variety of reasons, including additional store closings, notably Big Lots (BIG), that it sees providing incremental market share and real estate opportunities.
• Argus upgraded Xcel Energy (XEL) to Buy from Hold with a $68 price target. The firm is citing the company’s outlook for “solid” growth in 2024 along with its “data center potential” while also noting that Xcel tops its peers on several key valuation metrics.
• JPMorgan upgraded BJ’s Wholesale (BJ) to Neutral from Underweight with a price target of $78, up from $76. The analyst expects modest reflation in grocery and says the company is benefitting from its efforts to drive share by reinvesting in the business.

Top 5 Downgrades:

• Wolfe Research downgraded MoonLake Immunotherapeutics (MLTX) to Peer Perform from Outperform. The share setup may be less favorable into the first half of 2025 given a slowing market, aggressive timelines, and lower odds of a takeover, the analyst tells investors.
• Benchmark downgraded Premier (PINC) to Hold from Buy with no price target after Premier guided FY25 below consensus along with its “upside” Q4 print, citing greater-than-expected pressure on GPO admin fee share backs and a flattish outlook for Performance Services. Based on downwardly revised consensus and Benchmark models, the firm now thinks it’s likely that Premier shares “treads water at current levels into next year,” the analyst tells investors.
• Argus downgraded Wayfair (W) to Hold from Buy with no price target. The firm points to the company’s “muted prospects” due to decelerating home sales trends, with Q2 revenue for Wayfair having fallen 170 basis points and missing estimates.
• Janney Montgomery Scott downgraded Enova International (ENVA) to Neutral from Buy with a fair value estimate of $81, down from $82. In the past year, shares have risen 70% and the firm views the shares as “fairly valued,” the analyst tells investors.
• Wells Fargo downgraded Oaktree Specialty Lending (OCSL) to Equal Weight from Overweight with a price target of $17, down from $18. The analyst is more cautious on business development company names with “stretched” net operating income profiles on “what feels like” an acceleration of earnings moderation through credit headwinds and lower pointing base rates.

Top 5 Initiations:

• Morgan Stanley initiated coverage of Summit Materials (SUM) with an Overweight rating and $51 price target. The firm sees an attractive risk/reward for Summit shares given “tight” U.S. cement supply/demand, its vertically integrated business model, exposure to the “troughing” residential market, inorganic growth opportunity, and strong industry pricing.
• Benchmark assumed coverage of Pagaya (PGY) with a Buy rating and $21 price target. While some investors “zeroed in on a single negative data point” in Pagaya’s recent earnings report, they appear to have overlooked the company’s “significant progress on multiple fronts,” contends the analyst who took over coverage of the stock.
• Maxim initiated coverage of Jakks Pacific (JAKK) with a Buy rating and $46 price target. The company is well-positioned in the $28B toys market, which has been growing at a 6% CAGR expected to sustain this rate, the analyst tells investors
• Maxim also initiated coverage of Light & Wonder (LNW) with a Buy rating and $144 price target. The company is well-positioned for the digital – iGaming and Social – as well as “analogue”, or land-based, future of gaming, which are growing again following the pandemic setback, the analyst tells investors
• BTIG assumed coverage of FTAI Aviation (FTAI) with a Buy rating with a price target of $140, up from $80, as the new analyst noted the company’s “strong” adjusted EBITDA growth and Aerospace Products margins trending up towards 40%.