The futures were lower as traders returned from the long MLK holiday weekend for yet another shortened trading week and a deluge of S&P 500 fourth-quarter earnings reports. The major indexes closed higher last Friday, following through on the consumer-price-index report rally from last week. While the major banks all posted solid results to kick off the earnings season, the reality is these banks have set aside a stunning $4 billion dollars collectively in anticipation of a recession and all that can come with it, like loan and credit-card defaults and a massive overall slowdown in economic activity.
Yields were higher across the Treasury curve Friday, after a big rally in the government market last week that sent the 10-year down to the lowest yields since last fall. The sellers pushed the benchmark note back up to a 3.51% close on Friday. The inversion with the two-year paper remains in place, as it closed at 4.22%. Bond traders see the inversion as a recession sign.
Brent and West Texas Intermediate crude both closed higher on Friday, capping a strong 9% move higher last week for the two benchmarks after some sizable selling to start the year off. While demand concerns remain at the forefront, the potential for China to reopen more as the year proceeds can be just the tailwind energy traders are looking for. Natural gas was down almost 8% Friday to finish a very volatile week. Gold and Bitcoin closed higher, with the cryptocurrency giant closing back over the $20,000 level for the first time since November.
24/7 Wall St. reviews dozens of analyst research reports each day of the week with a goal of finding fresh ideas for investors and traders alike. Some of these daily analyst calls cover stocks to buy. Other calls cover stocks to sell or avoid. Remember that no single analyst call should ever be used as a basis to buy or sell a stock. Consensus analyst target data is from Refinitiv.
These are the top analyst upgrades, downgrades and initiations seen on Tuesday, January 17, 2023.
Aon PLC (NYSE: AON): Credit Suisse started coverage with an Outperform rating and a $363 target price. The consensus target is just $318.75, and the stock closed on Friday at $317.17.
Armstrong World Industries Inc. (NYSE: AWI): Evercore ISI’s upgrade was to In Line from Under Perform, though it also trimmed its $84 target price to $80. The consensus target is $89.70. The stock closed on Friday at $75.04.
Bally’s Corp. (NASDAQ: BALY): Citing negative earnings estimate revisions, Zacks selected this as its Bear of the Day stock. Shares have traded as high as $37.21 in the past year but closed most recently at $20.83. That is down 38% or so in the past year.
Build-A-Bear Workshop Inc. (NYSE: BBW): Zacks named this stock as its Bull of the Day. The analyst points out that it is one of the few that not only finished 2022 in positive territory but surged to multiyear highs. The stock last closed at $24.33 a share.
Carrier Global Corp. (NYSE: CARR): As Mizuho lifted its Neutral rating to Buy from, its $38 price target jumped to $53. The consensus target is $45.90. The shares closed on Friday at $45.87.
Caterpillar Inc. (NYSE: CAT): The BofA Securities upgrade to Buy from Neutral included a target price hike to $295 from $217. The consensus target is $234.05. The stock closed on Friday at $258.46.
Copa Holdings S.A. (NYSE: CPA): J.P. Morgan upgraded the stock to Overweight from Neutral. It also lifted its $105 target price to $132, well above the $112.19 consensus target. Friday’s close at $93.51 was up over 6% on the day, likely due to the upgrade.
D.R. Horton Inc. (NYSE: DHI): Though RBC Capital Markets downgraded the homebuilder to Underperform from Sector Perform, the analyst also raised the $68 target price to $76. The consensus target is $99.56. The stock closed on Friday at $94.96. At these trading levels, this looks like a valuation call.
Lithia Motors Inc. (NYSE: LAD): Wells Fargo downgraded the stock to Equal Weight from Overweight but lifted its $212 price target to $233. The consensus target is up at $298.69. The stock closed on Friday at $232.07.
Lockheed Martin Corp. (NYSE: LMT): The Goldman Sachs downgrade Sell from Neutral included a price target cut to $332 from $388. The consensus target is higher at $483.41. The stock closed on Friday at $449.83.
Mosaic Co. (NYSE: MOS): Exane BNP Paribas downgraded the stock to Underperform from Neutral and has a $42 target price. The consensus target is $60.30. Friday’s close was at $46.32.
Netflix Inc. (NASDAQ: NFLX): Oppenheimer reiterated an Outperform rating, and the prior $365 target price is now $400. The consensus target is just $305.58. The stock closed at $332.82 on Friday.
Northrop Grumman Corp. (NYSE: NOC): The Neutral rating at Goldman Sachs was lowered to Sell, and the $440 target price fell to $375. The consensus target is $564.20. Friday’s last trade was recorded at $461.43.
Overstock.com Inc. (NASDAQ: OSTK): Jefferies initiated coverage with a Hold rating and a $20 target. The consensus target is higher at $50.25. The stock closed almost 4% lower on Friday at $20.50.
Pentair PLC (NYSE: PNR): Mizuho upgraded the shares to Buy from Neutral and raised its $44 target price to $60. The consensus target is $51.73. The last trade on Friday came in at $50.52.
Rapid7 Inc. (NASDAQ: RPD): D.A. Davidson initiated coverage with a Neutral rating and a $34 target. That compares with a $45.79 consensus target and Friday’s closing print of $33.92.
Raytheon Technologies Corp. (NYSE: RTX): Goldman Sachs downgraded the defense giant to Neutral from Buy and trimmed its $115 price target to $105. The consensus target is $107.91. Friday’s closing share price was reported at $98.68.
Salesforce Inc. (NYSE: CRM): Atlantic Equities downgraded the stock to Neutral from Overweight. The analyst also slashed the $200 price target to $140, well below the $191.89 consensus target. Friday’s final trade was for $149.51 a share.
SPX Technologies Inc. (NYSE: SPXC): Oppenheimer raised its $74 target price on the Outperform-rated company to $77. The consensus target is $79.00, and the stock closed on Friday at $73.00.
Summit Materials Inc. (NYSE: SUM): Truist Securities started coverage with a Buy rating and a $40 target price. The consensus target is $34.36. The shares were last seen Friday trading at $32.02, up over 3% on the day.
Timken Co. (NYSE: TKR): BofA Securities upgraded the stock to Buy from Neutral and lifted its $71 target price to $87. That compares with a $77.80 consensus target and Friday’s closing trade of $78.15, which was up close to 4% for the day.
TransUnion (NYSE: TRU): Wells Fargo upgraded the shares to Overweight from Equal Weight, and it boosted the price target to $88 from $70. The consensus target is $73.74. The stock closed almost 3% higher on Friday at $68.65.
Vulcan Materials Co. (NYSE: VMC): The RBC Capital Markets upgrade to Outperform from Sector Perform included a target price hike to $191 from $170. The consensus target is $201.00, and the stock closed at $183.19 on Friday.
Warner Music Group Corp. (NASDAQ: WMG): Guggenheim downgraded the stock to Neutral from Buy and has a $35 target price. The consensus target is $37.72. Friday’s $32.58 closed down over 5% for the day on the downgrade.
Wendy’s Co. (NASDAQ: WEN): Evercore ISI downgraded the popular fast-food restaurant from Outperform to In Line with a $25 target price. The consensus target is $24.06. Friday’s close was at $23.08.
Workday Inc. (NASDAQ: WDAY): CapitalOne started coverage with an Overweight rating. The firm’s $200 target price is less than the $210.76 consensus target, but Friday’s final trade came in at $167.15.
Regardless of how the economy and the stock market fare in 2023, six top Goldman Sachs stock picks with dependable dividends likely will be excellent growth and income investments for those with a patient outlook.
Friday’s top analyst upgrades and downgrades included American Eagle Outfitters, American Tower, Boeing, Cinemark, Cleveland-Cliffs, CommScope, Crown Castle, Halliburton, Netflix, Spotify Technologies, TotalEnergies, Unity Software and Zscaler.
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