Nike Inc. (NYSE: NKE) was started with an Outperform rating and a $145 price target at RBC Capital Markets on October 12. The stock has closed at $127.66 ahead of that call, but after Thursday’s selling pressure, Nike was back above $128 late on Friday.
RBC’s call specified that Nike is the best-in-class in the athleisure category as a global athletic play. The firm expects that Nike will see a faster recovery from all of the COVID-19 disruptions. Its consensus target is right in line at $145.08.
Walmart Inc. (NYSE: WMT) saw an unusual wave of analyst calls this past week. What is unusual is that Walmart is set to report earnings on November 17, and many analysts prefer to react to earnings rather than jumping into the fire ahead of time. Walmart has been a COVID-19 winner, but the retail giant has warned that it noticed some slowing trends after the government did not pass a second stimulus bill in August.
Walmart was at $145.77 a share the prior Friday, and it fell to $143.54 on Monday when news of the vaccine was out. Interestingly enough, the short-lived sell-off was looking for a fourth day in a row of gains, if the 40-cent gain to $148.63 held on Friday. Deutsche Bank raised its target price to $163 from $144, KeyBanc Capital Markets raised its target to $155 from $150 and Jefferies raised its target to $170 from $165. Walmart trades very close to its $148.92 consensus target price.
Walt Disney Co. (NYSE: DIS) was down almost 1.7% at $135.52 ahead of its earnings report, but its stock traded up as much as 5% afterward, and it was still holding gains of about 1.9% at $138.15 late on Friday. Disney managed to beat expectations, with a narrower loss and slightly less of a hit to revenues.
Unfortunately, every aspect of its old business has been clobbered by the COVID-19 impact. That should say “except for its Disney+” streaming operations. Disney now has more than 73 million paying subscribers, it has plenty of room to raise prices down the road, and it can use that platform to release direct to the consumer if it wants to while still charging ticket prices.
Multiple analysts came out with higher price targets as the worst seems to be behind it, even if Disneyland remains shut. Morgan Stanley reiterated Disney as Overweight and raised its target to $160 from $135 ahead of the earnings report. Afterward, RBC Capital Markets upgraded it to Outperform with a $170 target price on Friday. And also on Friday, BofA Securities reiterated its Buy rating and raised its price objective to $166 from $146. Credit Suisse maintained its Outperform rating with the same $146 target price.
Again, one analyst call alone should never be a reason to chase stocks up or to bail out when the market is close to its highs. There were just many convictions behind some of the calls, and catalysts driving analyst calls tend to be more useful than routine housekeeping, where price targets are upgraded or lowered just because of an underlying stock price move.