Salesforce upgraded, ServiceNow 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:

• KeyBanc upgraded Salesforce (CRM) to Overweight from Sector Weight with a $440 price target. The energy around Agentforce is pervading the firm’s conversations with Salesforce customers, partners, and investors, with the analyst saying it is a fan of this agentic wave in AI compared to its copilot predecessor.
• Wells Fargo upgraded Cardinal Health (CAH) to Equal Weight from Underweight with a price target of $127, up from $101. The firm says its prior Underweight thesis is “increasingly in the rearview mirror.”
• JPMorgan upgraded Penn Entertainment (PENN) to Overweight from Neutral with a $27 price target. The firm presently sees a favorable risk-reward, with sightline to a bottoming of its regional land-based-casino cash flow generation, with a path to aggregate growth.
• Morgan Stanley upgraded TaskUs (TASK) to Overweight from Equal Weight with a price target of $21, up from $18. The firm views the stock as an attractively valued artificial intelligence beneficiary with exposure to key customers Meta (META) and Open AI.
• Needham upgraded Upstart (UPST) to Buy from Hold with a $100 price target. After having recently hosted investor meetings with the CFO and other executives, the analyst came away believing that Upstart has “achieved a proper balance in funding” and sees the better funding and strong balance sheet signaling “a bright future,” the analyst tells investors.

Top 5 Downgrades:

• KeyBanc downgraded ServiceNow (NOW) to Sector Weight from Overweight. While the firm has been thrilled with ServiceNow all year, it now feels that the rise of Agents in the broader software sector may chip into the company’s early AI leadership and differentiation, the analyst tells investors.
• JPMorgan downgraded D.R. Horton (DHI) to Underweight from Neutral with a price target of $156, down from $188. After maintaining a positive homebuilder sector stance over the past two years, the firm is shifting to a “more cautious, less constructive approach” for 2025.
• KeyBanc downgraded ZoomInfo (ZI) to Underweight from Sector Weight. The firm believes there are more attractive turnaround stories coming from positions of strength in its coverage.
• Barclays downgraded Hilton Grand Vacations (HGV) to Equal Weight from Overweight with a price target of $41, down from $44. Hilton Grand had a tough 2024, absorbing several quarters of worsening upgrade sales end execution missteps, the analyst tells investors in a research note.
• Chardan downgraded Editas Medicine (EDIT) to Neutral from Buy and withdrew the firm’s price target after the company announced a strategic transition to focus entirely on development of in vivo therapies after failing to find a partner for its clinical-stage ex vivo-edited sickle cell and beta thalassemia therapy, reni-cel.

Top 5 Initiations:

• Raymond James initiated coverage of American Eagle (AEO) with a Market Perform rating. The firm likes American Eagle’s long-term drivers across the American Eagle brand and especially for Aerie, which is in the early to moderate innings of growth, but views the risk/reward as balanced and is seeking better visibility on upside potential to expectations as sales growth slows and demand becomes choppier, the analyst tells investors in a research note.
• Goldman Sachs initiated coverage of Elf Beauty (ELF) with a Buy rating and $165 price target. The firm holds a positive long-term view on the beauty category and sees attractive organic growth potential supported by innovation and the category’s convergence with health and wellness, which it says has increased the addressable market for all players.
• CICC initiated coverage of Expedia (EXPE) with a Market Perform rating and $193 price target.
• Wolfe Research initiated coverage of Hologic (HOLX) with a Peer Perform rating and no price target. While material downside risk is likely limited from here, the firm feels near term respiratory headwinds and saline shortages likely make expectations too high and calls it “best to stay on the sidelines for now.”
• BofA reinstated coverage of Albertsons (ACI) with a Neutral rating and $22 price target following the termination of the merger agreement in which Kroger (KR) would have acquired the company. The firm believes that Albertsons’ focus on building customer lifetime value through pharmacy, digital, and loyalty initiatives supports its long-term outlook, but near-term upside could be limited as pharmacy mix/margin pressures and investments in digital continue.