Meta, Alphabet initiated: 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:

• MoffettNathanson upgraded Roku (ROKU) to Neutral from Sell with an $80 price target. The firm has advised clients to sell Roku’s stock over much of the past three years due to a strong conviction that consensus was mismodeling the drivers of Platform revenues, compounded by “incredibly poor financial disclosure,” but it has softened its view as it looks into the second half of 2024 and 2025.
• DA Davidson upgraded Datadog (DDOG) to Buy from Neutral with a price target of $140, up from $115. The firm’s proprietary developer data showed a strong positive inflection point for Datadog, which gives the firm confidence in the trajectory of demand.
• Wedbush upgraded Dine Brands (DIN) to Outperform from Neutral with a price target of $47, up from $34. The firm believes the company’s current sales challenges are well understood and reflected in the stock’s “depressed valuation.”
• Susquehanna upgraded Coherent (COHR) to Positive from Neutral with a price target of $120, up from $80. The firm believes new CEO Jim Anderson, and his platform optimization program, will “ultimately transform the company’s long-term financial model,” potentially providing the company with over 1,000 basis points of net margin expansion.
• Goldman Sachs upgraded Ford (F) to Buy from Neutral with a price target of $13, up from $12. There is a margin opportunity driven by the company’s more profitable commercial business – Ford Pro, with mid-teens EBIT margins – and growing software and services mix, and the management’s cost actions in internal combustion vehicles and EVs can help to offset industry headwinds, the firm tells investors in a research note.

Top 5 Downgrades:

• Raymond James downgraded Disney (DIS) to Market Perform from Outperform. The firm sees demand moderating at the company’s amusement parks after a strong post-COVID surge and says the shares are expected to remain range bound as it contends that consumers are still digesting price increases taken in the past roughly four years.
• Wells Fargo downgraded General Dynamics (GD) to Equal Weight from Overweight with a price target of $317, down from $334, as the firm is cautious on the company and Boeing (BA) into the Q3 results. General Dynamics’ 2024 guidance looked tough to hit at mid-year, and since then G700 deliveries appear to be well behind plan, Wells tells investors in a research note.
• Citi downgraded Hologic (HOLX) to Neutral from Buy with a price target of $85, down from $95. The firm believes current fiscal 2025 estimates are too high and will likely need to be lowered, driven by normalization of demand.
• Citi downgraded HP Inc. (HPQ) to Neutral from Buy with an unchanged price target of $37. The firm cites a more cautious view of the PC recovery in the second half of 2024 for the downgrade.
• Oppenheimer downgraded Global Payments (GPN) to Perform from Outperform following analyst coverage transfer. Despite the recent stock pullback, the firm remains cautious on Global Payments, particularly as the acquiring industry remains “intensely competitive.”

Top 5 Initiations:

• Pivotal Research initiated coverage of Meta Platforms (META) with a Buy rating and $780 price target. The firm sees a “strong” revenue growth outlook from increased usage, new products, better targeting and higher prices, boosted by cost efficiencies and eventually materially declining Reality Labs losses combined “with what appears to be an attractive valuation.”
• Pivotal Research initiated coverage of Alphabet (GOOG) with a Buy rating and $215 price target. If “the status quo holds,” Alphabet appears to be in a “very strong competitive position with a deep moat” around its dominant core search business model and an “obvious path” to leverage its global device presence, strong artificial intelligence platform and “financial might” to increase financial incentives to handset manufacturers for default AI placement, the firm tells investors in a research note.
• Oppenheimer initiated coverage of SharkNinja (SN) with an Outperform rating and $120 price target. The firm notes the company’s management team has executed quite well delivering consistent and well above expectation results in recent quarters, even in difficult U.S. consumer durables backdrop.
• Piper Sandler initiated coverage of Labcorp (LH) with a Neutral rating and $235 price target. The firm sees LabCorp as leading the industry in diagnostics services for decades, but with the stock’s run over the last six months, Piper thinks the risk/reward is balanced at these levels.
• Argus initiated coverage of Snowflake (SNOW) with a Hold rating. The company is in a building phase as it invests in new product enhancements, particularly around AI/machine learning which are not generating near-term revenue, even though they may begin to payoff sometime in the future, the firm tells investors in a research note.