Top Analyst Upgrades and Downgrades: CSX, Hess, McDonald’s, Netflix, Nike, Oracle, RingCentral, Starbucks, Tesla, VMware and More
December 10, 2019 by Jon C. OggStocks sold off on profit-taking and no major news driving events on Monday, and that was also seen on Tuesday morning, with the Dow Jones industrials and S&P 500 futures indicated down 0.3% to 0.4% ahead of the opening bell. Investors are seeing more upside calls for 2020 stock market performance, and all those recession calls in recent months were simply nothing more than an error or head fakes. Many pressing issues and risks to consider remain now that the bull market has raged longer than in our lifetimes. Investors should be considering what changes they should make to their portfolios and assets heading into 2020.
24/7 Wall St. reviews dozens of analyst research reports each day of the week. Our goal is to find new ideas for traders and long-term investors alike. Some of the daily analyst calls cover stocks to buy, while others cover stocks to sell or to avoid.
We have provided these calls in a quick-hit summary for easy reading, and additional comments and trading data have been added on some calls. The consensus price targets mentioned and other valuation metrics are from the Refinitiv sell-side research service.
These are the top analyst upgrades, downgrades and initiations for Tuesday, December 10, 2019.
AdaptHealth Corp. (NASDAQ: AHCO) was started as Buy with a $12 target price at Deutsche Bank.
Bunge Ltd. (NYSE: BG) was raised to Buy from Neutral with a $67 target price at Goldman Sachs.
CSX Corp. (NYSE: CSX) was downgraded to Neutral from Buy and the target price was cut to $75 from $80 at Citigroup.
Devon Energy Corp. (NYSE: DVN) was raised to Overweight from Neutral with a $34 target price at JPMorgan.
Eldorado Resorts Inc. (NASDAQ: ERI) was named as the Zacks Bear of the Day stock. The firm said that a planned acquisition of Caesars will add almost $9 billion in debt to an already stressed balance sheet. Shares of Eldorado last closed at $52.92, with a consensus price target of $61.45.
Hess Corp. (NYSE: HES) was raised to Neutral from Underweight with a $65 target price at JPMorgan.
International Paper Co. (NYSE: IP) was downgraded to Sell from Neutral with a $40 target price at Goldman Sachs.
ITT Inc. (NYSE: ITT) was raised to Buy from Neutral and the target price was raised to $81 from $70 at Goldman Sachs.
LTC Properties Inc. (NYSE: LTC) was downgraded to Underperform from Market Perform with a $43 target price at Wells Fargo.
Netflix Inc. (NASDAQ: NFLX) was downgraded to Underperform from Hold at Needham, with the firm noting that Netflix needs to include a lower-priced service to compete with new entrants (Apple, Disney+, Hulu, CBS) but that its balance sheet will not really support a lower-tier priced service. The call also notes that as many as 4 million subscribers may cancel in 2020. Shares closed down 1.6% at $302.50 and have a 52-week range of $231.23 to $385.99. The consensus price target is $361.18.
Nike Inc. (NYSE: NKE) was reiterated as Buy and the price objective was raised to $105 from $98 at Merrill Lynch. Shares closed at $96.63, in a 52-week range of $66.53 to $97.63. The consensus price target is $102.97.
NXP Semiconductors N.V. (NASDAQ: NXPI) was reiterated as Buy and the price objective was raised to $145 from $140 at Merrill Lynch.
ObsEva SA (NASDAQ: OBSV) saw its shares fall 29% to $3.23 on Monday, but they were indicated up 26% at 44.08 on Monday. Wedbush Securities maintained its Outperform rating and has a whopping $36 price target, as the firm sees frontline potential and thinks Linzagolix without ABT could dominate the market.
Oracle Corp. (NYSE: ORCL) was reiterated as Neutral with a $55 target price (versus a $55.31 prior close) at Wedbush, with the firm noting that Oracle needs to pick up the pace and that it remains on the sidelines looking for meaningful and more sustainable progress in rebooting database growth from either cloud/autonomous or BYOL.
Owens-Illinois Inc. (NYSE: OI) was raised to Buy from Neutral with a $13 target price at Goldman Sachs.
Packaging Corp. of America (NYSE: PKG) was downgraded to Sell from Neutral with a $102 target price at Goldman Sachs.
Prologis Inc. (NYSE: PLD) was raised to Outperform from Market Perform with a $100 price target at Wells Fargo.
Redfin Corp. (NASDAQ: RDFN) was raised to Buy from Neutral and the price target was raised to $25 from $18.50 at D.A. Davidson.
Rapid7 Inc. (NASDAQ: RPD) was started as Overweight with a $67 target price at Piper Jaffray.
RingCentral Inc. (NYSE: RNG) was started as Overweight with a $194 target price at Piper Jaffray.
State Street Corp. (NYSE: STT) was raised to Outperform from Market Perform with a $86 target price at Keefe Bruyette & Woods.
Tesla Inc. (NASDAQ: TSLA) was named as the Bull of the Day at Zacks, which said that the world’s leading electric automaker is still way ahead of the competition. Shares most recently closed at $339.53 and have a consensus price target of $283.48.
Thor Industries Inc. (NYSE: THO) was reiterated as Underperform and the price objective was lowered to $45 from $47 at Merrill Lynch.
Ventas Inc. (NYSE: VTR) was downgraded to Underperform from Market Perform at Wells Fargo.
VMware Inc. (NYSE: VMW) was started as Overweight with a $170 target price at Piper Jaffray.
RBC Capital Markets issued new Outperform ratings in the food services and restaurant business. These include Starbucks Corp. (NASDAQ: SBUX), with a $97 target; McDonald’s Corp. (NYSE: MCD), with a $218 target; Domino’s Pizza Inc. (NYSE: DPZ), with a $337 target; and Restaurant Brands International Inc. (NYSE: QSR), with a $77 target. Brinker, Chipotle, Dunkin’, Wendy’s and Yum Brands were all started with Sector Perform ratings in the new RBC coverage.
Wedbush has a cautious view of many homebuilders for 2020, after noting that there will be tougher comps in the second half of the year, while it actually sees the near-term setup looking enticing. The firm would maintain current holdings in the homebuilders and look to initiate new positions in names that have pulled back from recent highs. The firm’s Outperform names that fit that bill include Century Communities Inc. (NYSE: CCS), Lennar Corp. (NYSE: LEN), Beazer Homes USA Inc. (NYSE: BZH) and Taylor Morrison Home Corp. (NYSE: TMHC).
Raymond James is bullish on oil surging in 2020 to 2021, and the firm has six strong buys for the outsized upside that will win if the firm is correct.
Monday’s top analyst upgrades and downgrades included Adobe, Chevron, Dow, JD.com, Lululemon, 3M, Macy’s, Nucor, PNC, RH, RingCentral, WingStop, Zillow and many more.
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