Top Analyst Upgrades and Downgrades: Groupon, Merck, News Corp, Disney, Vonage, Western Digital and More

October 27, 2016 by Jon C. Ogg

Stocks were indicated higher Thursday morning, and the barrage of earnings just keeps coming. Investors have proved over and over that they will buy each pullback. High valuations and even this bull market being seven and a half years old just are not stopping equity buyers. Investors are also looking for new ideas to generate gains or income ahead.

24/7 Wall St. reviews dozens of analyst research reports each morning of the week to find new investing and trading ideas for our readers. Some of these analyst research reports cover stocks to buy, and other calls cover stocks to sell or avoid.

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

Groupon Inc. (NASDAQ: GRPN) was last seen trading down 8.5% at $4.81 after earnings. The stock was reiterated as Outperform with a $6.50 price target at Wedbush Securities. Goldman Sachs has a Neutral rating but raised its target to $4.80. Groupon has a 52-week trading range of $2.15 to $5.94, and it had a consensus analyst target price of $5.24.

Merck & Co. Inc. (NYSE: MRK) was reiterated as Buy at Argus, and the firm raised its price target to $80 from $65. That is up over 30% from the $60.87 close, plus there is the 3% dividend yield. The firm saw earnings growth driven by strong sales of oncology drug Keytruda, Zepatier for hepatitis C and Gardasil for HPV.

News Corp. (NASDAQ: NWSA) was downgraded to Underperform from Neutral at Merrill Lynch, which noted that shares were within 7% of its $14 price objective. The firm believes that significant secular challenges still confront its News & Information Services segment and its 2017 estimates on earnings are now 17% below consensus. Shares closed up 2% on Wednesday at $12.91 and were indicated down 1.6% at $12.70 on Thursday. The 52-week range is $10.21 to $15.68, and the consensus target price is $15.47.

Walt Disney Co. (NYSE: DIS) was maintained as Outperform at Credit Suisse, but the firm lowered its price target to $125 from $128. Ahead of earnings, the firm sees premium assets but a company that is hampered by strategic challenges. The stock closed at $93.49, and it has a 52-week range of $86.25 to $120.65 and a $107.14 price target.

Vonage Holdings Corp. (NYSE: VG) was reiterated as Outperform at Oppenheimer, but the firm raised its target to $8 from $7 (versus a $7.08 prior close). Oppenheimer said earnings were solid, and the firm sees a ramp in investment and sales, with the Nexmo integration bring continual growth. The stock closed up 10% at $7.08 after earnings on Wednesday, and its 52-week range is $3.82 to $7.57.

Western Digital Corp. (NASDAQ: WDC) was raised to Neutral from Underperform at Merrill Lynch. The firm is still a tad cautious as there are many moving pieces, but it sees the fundamentals being undeniably better. The shares closed up over 5% at $56.52 on Wednesday and were indicated up 4.4% at $59.00 on Thursday.

You can follow @Jonogg on Twitter if you want the daily analyst calls and research updates directly on your Twitter feed.

Other key analyst upgrades and downgrades were seen as follows:

Allegiant Travel Co. (NASDAQ: ALGT) was downgraded to Market Perform from Outperform at Raymond James.

BOK Financial Corp. (NASDAQ: BOKF) was raised to Neutral from Underperform at Macquarie. Wedbush reiterated its Neutral rating with a $69 price target.

Entergy Corp. (NYSE: ETR) was downgraded to Equal Weight from Overweight with a $68 price target (versus a $72.28 close) at Morgan Stanley.

Hershey Co. (NYSE: HSY) was raised to Buy from Neutral at Citigroup. Shares were indicated up 1% at $97.11 on Thursday.

Logitech International S.A. (NASDAQ: LOGI) was raised to Neutral from Underweight and the price target was lowered to $14 from $18 (versus a $25.22 close) at JPMorgan.

Norwegian Cruise Line Holdings Ltd. (NASDAQ: NCLH) was downgraded to Neutral from Overweight with a $44 price target (versus a $37.97 close) at JPMorgan.

Quintiles IMS Holdings Inc. (NYSE: Q) was downgraded to Neutral from Overweight at Piper Jaffray.

Royal Caribbean Cruises Ltd. (NYSE: RCL) was downgraded to Neutral from Overweight with a $73 price target (versus a $69.90 close) at JPMorgan.

Scripps Networks Interactive Inc. (NYSE: SNI) was downgraded to Underperform from Neutral at Merrill Lynch.

Six Flags Entertainment Corp. (NYSE: SIX) was reiterated as Buy at Janney, but the firm did lower its fair value target to $62 from $64 (versus a $53.89 close). Janney believes the quarter was negatively affected by poor weather and that its business fundamentals are still strong.

Wednesday’s top analyst calls were in Apple, Baker Hughes, Chipotle Mexican Grill, Dollar General, General Motors, Lowe’s, Under Armour and over a dozen more.