Each morning we cover about fifteen top analyst calls for investors and traders to consider. Some calls offer great insight, and some are quite literally career-killing flops. At the end of the week we go back over the calls we covered and the ones we missed to highlight the “Top Analyst Calls of the Week.” This week wave ten top research calls that stood out from the pack in the following: Alcatel-Lucent (NYSE: ALU); Baidu, Inc. (NASDAQ: BIDU); Citigroup, Inc. (NYSE: C); Fortress Investment Group (NYSE: FIG); Google Inc. (NASDAQ: GOOG); Lululemon Athletica Inc. (NASDAQ: LULU); Renren Inc. (NYSE: RENN); Sears Holding Corporation (NASDAQ: SHLD); Spreadtrum Communications Inc. (NASDAQ: SPRD); and Western Digital Corporation (NYSE: WDC).
We have outlined the analyst calls, shown an impact and added in color on each if applicable. As a bonus, we also covered a list of biotech buyout candidates from UBS and we covered the mega-IPO from London-listed Glencore as the commodity giant’s quiet period ended.
Alcatel-Lucent (NYSE: ALU) was raised to Buy at UBS on Thursday, and the implied price target was raised to $6.61. The argument is that the selling from the peak in May has led to an oversold reading in the stock. This is still one of the best recovered networking and telecom equipment players out there for 2011.
Baidu, Inc. (NASDAQ: BIDU) may be a controversial call here. Sure China is slowing, but things are just picking back up for the stock and for some China players after getting beaten for weeks due to accounting fears in all aspects of China. S&P Equity Research downgraded the shares to “Hold” from “Buy” on Thursday during the afternoon. The stock paid no attention to the downgrade for all practical purposes.
Biotech and Emerging Pharma was given an interesting call from the analyst teams over at UBS. The research group came up with four biotech buyout targets this week.
Citigroup, Inc. (NYSE: C) was raised to Buy with a $53 target at BofA/Merrill Lynch this week and the macro-events must have been perfectly timed for this. What is interesting is that this must have been a self-serving upgrade around the huge mortgage settlement that was also given an extra boost from the debit card swipe-fee being lifted from $0.12 to $0.21 on average. We have always said this and still maintain it… “When analysts at investment banks upgrade their competitor shares, they may really be upgrading their own shares.”
Fortress Investment Group (NYSE: FIG) was given a big private equity valuation pop as being much better positioned than many private equity peers. Credit Suisse started analyst coverage with an “Outperform” and it gave it a $7.00 price target objective. What matters about that is the implication… it was calling for more than 50% upside in the units.
Google Inc. (NASDAQ: GOOG) made a huge score this week. Canaccord Genuity reiterated its “Buy” rating on Google, but it also came out maintained its Street-High $800 price target. That might be too aggressive for our own breaches, but that implied more than 60% upside. Shares were at $480 on Monday and up close to $520 on Friday. Not bad.