Roblox, Peloton upgraded: 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:

• Morgan Stanley upgraded Roblox (RBLX) to Overweight from Equal Weight with a price target of $65, up from $38. The company is proving that its user-generated content platform can drive accelerating share gains, as it reaches larger and more diverse audiences across more platforms, the firm tells investors in a research note.
• BofA double upgraded Peloton (PTON) to Buy from Underperform with a price target of $9, up from $3.75. The firm cites higher estimates after fiscal Q1 “surprised” with much higher-than-expected EBITDA and FY25 guidance was raised to $240M-$290M, versus the $232M Street view.
• BofA upgraded Charter (CHTR) to Buy from Neutral with a price target of $450, up from $385. ACP headwinds are largely behind the company and broadband sub trends should continue to improve, notes the firm, which is also reducing its capex estimate for 2024 and sees post 2025 capex to decline significantly, supporting the firm’s new higher free cash flow estimates.
• Argus upgraded AbbVie (ABBV) to Buy from Hold with a $220 price target. Two of the company’s key immunology products, Skyrizi and Rinvoq, have succeeded Humira as growth engines, with the former having grown its Q3 sales 52% on an operational basis to $3.21B, and the sales of the latter rising 47% to $1.61B, the firm tells investors in a research note.
• Argus upgraded Norwegian Cruise Line (NCLH) to Buy from Hold with a $30 price target. The firm is citing the company’s increased occupancy, higher ticket prices and strong advance bookings for 2025 benefiting its results.

Top 5 Downgrades:

• Jefferies downgraded Booz Allen (BAH) to Hold from Buy with a price target of $190, up from $180. Management and share price performance “has been stellar,” but the firm is taking a timeout on shares as it believes EPS revisions through FY25 may be limited, largely due to margins being range bound as Defense outperforms Civil.
• UBS downgraded Ecolab (ECL) to Neutral from Buy with an unchanged price target of $276. While Ecolab is “back on stride,” generally meeting or beating expectations and delivering 22% annual earnings growth over the past two years, the company’s adjusted earnings growth will return “back into the normal” algorithm range, creating less outperformance verses expectations, the firm tells investors in a research note.
• BTIG downgraded Fiverr (FVRR) to Neutral from Buy without a price target. The shares have rallied 35% in the last week, but three recent developments have given BTIG “some pause,” the firm tells investors in a research note.
• BofA downgraded Entergy (ETR) to Neutral from Buy with a price target of $154, up from $138, after the company reported Q3 earnings announcement and updated its strategic business plan with a higher capital spending forecast, higher sales growth forecast, higher EPS guidance and a higher EPS growth rate. While recognizing the value created by this strategic update, the firm also appreciates the associated execution risk and cites both that risk and the current valuation for its downgrade.
• Goldman Sachs downgraded Option Care Health (OPCH) to Neutral from Buy with a $27 price target. The firm had previously held the view that Option Care’s drugs, including Stelara, were less exposed to gross profit pressure as drugs went generic, but on the Q3 earnings call, management disclosed that Stelara’s manufacturer, Johnson & Johnson (JNJ) had negotiated for a significant and rapid decline in the drug-spread on Stelara for OptionCare in 2025.

Top 5 Initiations:

• Gordon Haskett initiated coverage of Casey’s General Stores (CASY) with a Hold rating and $400 price target, which “appropriately balances” the firm’s favorable view of the convenience store industry, Casey’s differentiated value proposition, and conviction in the company’s execution against elevated valuation levels, persistent external risks, and the likelihood that structural tailwinds may have already peaked, particularly on the gas side of the business.
• Goldman Sachs initiated coverage of KinderCare Learning (KLC) with a Buy rating and $41 price target. The firm believes the company is differentiated through its focus on community-based childcare centers. It expects this to be a driver of occupancy growth to combine with tuition increases. BMO Capital, UBS, JPMorgan and Barclays also started coverage of the name with Buy-equivalent ratings, while Morgan Stanley, Deutsche Bank and Baird initiated coverage of the stock with Neutral-equivalent ratings.
• Piper Sandler initiated coverage of Nektar (NKTR) with an Overweight rating and $7 price target. The firm believes Nektar’s lead asset rezpegaldesleukin has a differentiated IL-2Ralpha mechanaism of action that selectively stimulates tregs.
• Barclays initiated coverage of Rollins (ROL) with an Equal Weight rating and $50 price target. The firm believes the company has a “best-in-class” brand but says the shares “may have been priced for perfection.”
• DA Davidson initiated coverage of Everus (ECG) with a Neutral rating and $55 price target. The firm is positive on the company’s exposure in data centers, semiconductor fabs and electrical T&D, with potential to expand the platform with greater capital allocation flexibility post MDU-spin lending inorganic growth potential, though it is also “hesitant” to put upper-tier industry multiples on the shares at this juncture.