Top Analyst Upgrades and Downgrades: Alibaba, ADM, CSC, Infosys, Microsoft, Wells Fargo, WisdomTree and More

May 26, 2016 by Jon C. Ogg

Stocks were indicated higher on Thursday, after gains on Tuesday and Wednesday were handy. Oil also crossed back above the $50 barrier again for the first time since October 2015. The notion of “sell in May and go away” has not spooked investors, nor has the decline in earnings and the weak economic readings. And now rate hikes may be a good thing.

As investors have proven time after time that they are willing and able to buy the dips, there is always the hunt on for opportunity. 24/7 Wall St. reviews dozens of analyst research reports each morning of the week. The goal is to find new investing and trading ideas for our readers. Some of these analyst reports cover stocks to buy, and other reports feature stocks to sell or avoid.

These are the top analyst upgrades, downgrades and initiations seen on Thursday morning:

Alibaba Group Holding Ltd. (NYSE: BABA) traded down 6.8% to $75.59 on the heels of an SEC investigation. Oppenheimer maintained an Outperform rating in a late Wednesday flash note. Merrill Lynch has maintained its Buy rating and left its $99 price objective intact, despite acknowledging some concerns in that 20-F filing.

Archer Daniels Midland Co. (NYSE: ADM) was raised to Buy from Neutral at Citigroup. Shares closed at $42.48, and the consensus analyst price target is $40.20. The 52-week trading range is $29.86 to $53.31.

Computer Sciences Corp. (NYSE: CSC) was reiterated as Buy at Jefferies, and the price target was raised to $63 from $36. Its consensus price target was listed as $33.64, but that may not include the wave of higher targets after the HPE deal. Its 52-week trading range is $24.27 to $50.90.

Infosys Ltd. (NYSE: INFY) was raised to Buy from Neutral at Goldman Sachs. The stock closed at $18.81, has a consensus price target of $19.97 and has a 52-week range of $15.30 to $20.47.

Microsoft Corp. (NASDAQ: MSFT) was reiterated as Underperform with a $40 price target (versus a $52.12 prior close) at Jefferies. This is actually among the lowest price targets on Wall Street, but the lowest price target is listed as $36. Microsoft has a consensus analyst target of $57.66 and a 52-week range of $39.72 to $56.85.

Wells Fargo & Co. (NYSE: WFC) lowered ROE/ROA targets but shares rose after hopes of a rate hike and after analysts defended it on Wednesday. Oppenheimer only maintained a Perform rating on Wells Fargo. Credit Suisse maintained its Outperform rating and $58 price target. Wells Fargo closed up 2.6% at $50.50 on Wednesday and was indicated up 0.5% at $50.75 early Thursday. It has a consensus price target of $54.87 and a 52-week range of $44.50 to $58.77.

WisdomTree Investments Inc. (NASDAQ: WETF) was reiterated as Outperform with a $17 price target at Credit Suisse (versus an $11.89 close). The firm sees the current negative sentiment creating the best buying opportunity for long-term investors. Credit Suisse also thinks WisdomTree would be a cheap M&A target. The consensus target price is $11.75, and the 52-week range is $9.75 to $26.23.

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Other key analyst upgrades and downgrades from this Thursday were seen in the following companies:

Agilent Technologies Inc. (NYSE: A) was reiterated as Buy at Janney, but the fair value estimate was raised to $55 from $52 (versus a $45.42 close). Merrill Lynch maintained its Buy rating and its $49 price objective. These were after the analyst day.

AmeriGas Partners L.P. (NYSE: APU) was started with a Buy rating and it was assigned a $50 fair value estimate at Janney.

Apache Corp. (NYSE: APA) was reiterated as Underperform but the price target was raised from $35 to $40.

Atlassian Corp. PLC (TEAM) was started with an Outperform rating and was given a $28 price target (versus a $22.82 close) at Oppenheimer.

AXIS Capital Holdings Ltd. (NYSE: AXS) was downgraded to Neutral from Buy at Janney, with the firm noting that it is lacking near-term catalysts.

Bank of Montreal (NYSE: BMO) was downgraded to Hold from Buy at TD. Credit Suisse maintained its Neutral rating.

Carrizo Oil & Gas Inc. (NASDAQ: CRZO) was reiterated as Buy and the price target was raised from $38 to $44 at Jefferies.

Caterpillar Inc. (NYSE: CAT) was maintained as Neutral with an $81 price objective (versus a $72.57 close) at Merrill Lynch. The firm sees few green shoots, but it says the dividend remains secure despite having risen to 4.2%.

Fresenius Medical Care AG & Co. KGaA (NYSE: FMS) was reinstated as Buy at Merrill Lynch, noting that there could be 26% upside in the converted price of American depositary shares (ADSs) as the company is turning the earnings cycle.

GW Pharmaceuticals PLC (NASDAQ: GWPH) was reiterated as Buy with a $165 price objective (versus an $87.95 close) at Merrill Lynch. The firm talked about Phase 3 trial of Epidiolex for Lennox-Gastaut syndrome (LGS), as well as the NDA filing and commercialization.

Huntington Bancshares Inc. (NASDAQ: HBAN) was downgraded to Neutral from Outperform at R.W. Baird.

Jack in the Box Inc. (NASDAQ: JACK) was raised to Outperform from Neutral at R.W. Baird. Oppenheimer reiterated its Outperform rating with a $91 price target.

Pure Storage Inc. (NYSE: PSTG) was downgraded to Market Perform from Outperform at BMO Capital Markets, and the price target was slashed to $13 from $25. Merrill Lynch maintained its Buy rating but lowered its price objective to $18 from $22. Pure Storage closed up 1.1% at $14.72 on Wednesday, but the stock is down over 18% at $11.95 after earnings, versus a 52-week range of $11.05 to $20.60.

Shire PLC (NASDAQ: SHPG) was started with a Buy rating at Stifel and was assigned a $230 price target (versus a $191.78 close).

Wednesday’s top analyst upgrades and downgrades includes Applied Materials, Best Buy, Nokia, CSC, HPE, Monsanto, Noble Energy, Western Digital and over a dozen more companies.

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