Apple, Amazon downgraded: Wall Street’s top analyst calls

The most talked about and market moving research calls around Wall Street are now in one place. Here are today’s research calls that investors need to know, as compiled by The Fly.

Top 5 Upgrades:

• Piper Sandler upgraded Netflix (NFLX) to Overweight from Neutral with a price target of $800, up from $650. Piper says Netflix “is a clear leader in streaming” and that it now appreciates “the company is expensive for a reason.”
• Macquarie upgraded Alibaba (BABA) to Outperform from Neutral with a price target of $145, up from $79.70. The firm sees “more upside from here” for the China internet sector, saying multiples still trade at only half of Q1 2023 levels “with materially better fundamentals.” Macquarie also upgraded PPD Holdings (PDD) to Outperform from Neutral.
• Bernstein upgraded Campbell (CPB) to Outperform from Market Perform with a price target of $58, up from $55. The firm believes the soup and broth categories could benefit from higher weight loss drug usage.
• Bernstein double upgraded Coupang (CPNG) to Outperform from Underperform with a $30 price target. The firm says the company has exceeded expectations “mainly due to two unexpected events:” its subscription fee increase and an industry-level liquidity crisis.
• Vertical Research upgraded Air Products (APD) to Buy from Hold with a $336 price target. News that Mantle Ridge has amassed a $1B-plus stake in Air Products, or an ownership stake of about 1.6% or more, is a “game changer,” says the firm. Evercore ISI and Jefferies also upgraded the stock to Buy-equivalent ratings.

Top 5 Downgrades:

• Jefferies downgraded Apple (APPL) to Hold from Buy with a price target of $212.92, up from $205, after transfer of analyst coverage. The firm likes Apple Intelligence long-term, but says the company’s smartphone hardware needs rework before being capable of serious AI, with a likely timeline of 2026 or 2027.
• Wells Fargo downgraded Amazon.com (AMZN) to Equal Weight from Overweight with a price target of $183, down from $225. The firm says Amazon’s “positive estimate revision story faces multiple headwinds.”
• Barclays downgraded Netflix to Underweight from Equal Weight with an unchanged price target of $550. Netflix’s “premium valuation” is predicated on revenue growth being at least in the low-double-digits “for some time,” which the firm thinks will get more difficult, with the company’s growth algorithm coming “with tradeoffs.”
• TD Cowen downgraded Humana (HUM) to Hold from Buy with a price target of $261, down from $402. Despite the company’s Medicare Advantage plans’ ability to reprice the business each year and potentially improve star ratings each year, the overall recovery story for Humana “has become too complicated,” the firm tells investors in a research note. Jefferies also downgraded Humana to Hold from Buy with a price target of $253, down from $519.
• UBS downgraded Hershey (HSY) to Neutral from Buy with a price target of $209, down from $226. The firm says Street estimates for 2025 look particularly optimistic given continued input cost pressured coupled with a demand backdrop that remains both challenging and uncertain. Bernstein also downgraded Hershey to Market Perform from Outperform with a price target of $205, down from $230.

Top 5 Initiations:

• Gordon Haskett initiated coverage of Foot Locker (FL) with an Accumulate rating and $27 price target. The company’s “Lace Up” strategy under CEO Mary Dillon has not been smooth, but the fiscal 2023 headwinds are behind it and fiscal 2024 is showing signs of improvement, the firm tells investors in a research note.
• Benchmark initiated coverage of Dave & Buster’s (PLAY) with a Hold rating and no price target. While the operator of high-volume entertainment and dining venues in North America is managing its business well and executing on several strategic initiatives, the challenging macroeconomic environment has, in some cases, offset the positive impact of these growth efforts, the firm tells investors.
• BofA initiated coverage of Fastenal (FAST) with a Buy rating and $85 price target. The firm thinks the company is making the “right changes” to outgrow the market and peers after having lagged its long-term market share gain targets in recent years.
• BofA initiated coverage of Grainger (GWW) with an Underperform rating and $925 price target. The firm thinks that as the manufacturing environment normalizes, the company’s operating performance will stay near historical levels, but sees slower market share gains going forward coupled with contracting EBITDA margins in 2024 and onward.
• JPMorgan initiated coverage of Quanta Services (PWR) with a Neutral rating and $297 price target. The firm views Quanta as a “clear-cut industry leader with best-in-class” execution, scale and innovation across the infrastructure services sector, but sees the stock as fairly valued.