Friday's Biggest Analyst Calls: Alphabet, Ferrari, Grab Holdings, Chewy, Abercrombie & Fitch, Shift4Payments, Marvel, Western Alliance, Nvidia, Netflix, Occidental Petroleum, Ulta, Imax, Microsoft
Here are the most significant analyst calls that took place on Friday:
Alphabet: Reiterated as Outperform by Baird
Baird reaffirmed its outperform rating on Alphabet, citing the upcoming Google Cloud Next event as a potential catalyst for the stock. The conference is expected to bring announcements related to Google's AI initiatives and cloud platform enhancements.
Ferrari: Reiterated as Hold by Jefferies
Jefferies maintained its hold rating on Ferrari but raised its price target. The firm believes that Ferrari's guidance methodology may require a different approach as managing expectations tightly and posting small increments may have run its course.
Grab Holdings: Upgraded to Overweight by Barclays
Barclays upgraded Grab Holdings, the Asian ride-hailing and food delivery company, to overweight following its recent earnings report. The firm views Grab as the dominant player in Southeast Asia in both ride-hailing and food delivery.
Chewy: Reiterated as Overweight by JPMorgan
JPMorgan maintained its overweight rating on Chewy, the online pet retailer, despite cautiousness ahead of its upcoming earnings report. The firm believes that concerns around active customer growth will persist but expects muted trends through the second half of the fiscal year.
Abercrombie & Fitch: Upgraded to Equal Weight by Morgan Stanley
Morgan Stanley upgraded Abercrombie & Fitch after its recent earnings report. The firm sees the second-quarter results as further evidence of a turnaround for the company, particularly with positive developments in its Hollister brand.
Shift4Payments: Upgraded to Equal Weight by Morgan Stanley
Morgan Stanley upgraded Shift4Payments, a payment company, primarily based on valuation. The firm believes that the current valuation is more appropriate and reflective of strong volume trends, despite long-term revenue challenges related to falling spreads.
Marvel: Reiterated as Buy by Citi
Citi maintained its buy rating on Marvel following its earnings report. However, the firm considers the stock to be a "show me" story, believing that the non-AI business needs to stabilize for meaningful estimate beats at current valuation levels.
Western Alliance: Reiterated as Overweight by Piper Sandler
Piper Sandler reaffirmed its overweight rating on Western Alliance, a regional bank, based on above-average returns at below-average multiples. The firm highlights the bank's strong performance, relative market strength, and a skilled management team.
Nvidia: Reiterated as Buy by Needham
Needham maintained its buy rating on Nvidia, a technology company, following a transfer in analyst coverage. The firm highlights Nvidia's strong performance driven by high demand for accelerated computing and generative AI.
Netflix: Upgraded to Buy by Loop
Loop upgraded Netflix to buy from hold, citing the company as a key beneficiary of the strike in Hollywood. The firm believes that the strike will accelerate the decline of the traditional TV business, benefiting streaming and, by extension, Netflix.
Occidental Petroleum: Reiterated as Buy by Goldman Sachs
Goldman Sachs reaffirmed its buy rating on Occidental Petroleum, emphasizing the company's attractive free-cash flow generation. The firm sees potential for corporate simplification, debt reduction, and share repurchases.
Ulta: Reiterated as Overweight by Barclays
Barclays maintained its overweight rating on Ulta, a specialty multi-brand retailer in the beauty sector, following its earnings report. The firm acknowledges potential near-term demand and margin pressure but believes Ulta is uniquely positioned based on historical resilience and strong execution.
Imax: Reiterated as Buy by Benchmark
Benchmark maintained its buy rating on Imax, a film exhibition company, despite reports of film release delays. The firm believes that revenue from the domestic box office has exceeded initial projections and that delays in film releases should not significantly impact the ongoing resurgence of the box office.
Microsoft: Reiterated as Outperform by Oppenheimer
Oppenheimer maintained its outperform rating on Microsoft, highlighting the company's strong position for AI. The firm believes that the cloud market is still in its early stages, with AI driving overall TAM and adoption rate, and Microsoft is well-positioned to capitalize on these trends.
In summary, these analyst calls provide insights into various companies across different sectors. Investors should consider these recommendations when making investment decisions, taking into account the analysts' perspectives on each company's performance and future prospects.
Conclusion: Impact on New Businesses
This compilation of analyst calls provides valuable insights for new businesses. The "hot take" is that these calls highlight the importance of understanding market trends and adapting business strategies accordingly.
Adapting to Market Trends
For instance, the reaffirmation of Alphabet's outperform rating based on upcoming AI initiatives and cloud platform enhancements underscores the growing importance of AI and cloud technologies. New businesses, especially in the tech sector, should consider integrating these technologies into their operations.
Valuation and Performance
The upgrades of Abercrombie & Fitch and Shift4Payments based on recent earnings reports and valuation respectively, highlight the significance of financial performance and market valuation. New businesses should focus on improving their financial performance and understand how the market values their stocks.
The upgrade of Netflix to buy from hold due to the strike in Hollywood indicates the shift in consumer preferences from traditional TV to streaming services. New businesses, particularly in the entertainment sector, need to be aware of these consumer trends and adapt their offerings accordingly.
In conclusion, new businesses can learn from these analyst calls and use these insights to navigate the market, adapt to trends, and improve their performance and valuation.