UPS, AGNC, Spotify, Broadcom Stocks Trending With Analysts

Analysts are intrested in these 5 stocks: ( (UPS) ), ( (AGNC) ), ( (SPOT) ) and ( (AVGO) ). Here is a breakdown of their recent ratings and the rationale behind them.

United Parcel Service is suddenly back on analysts’ radar, with HSBC’s Parash Jain upgrading the stock to Buy and lifting the target price to $125. The call comes after UPS delivered a stronger-than-expected fourth quarter of 2025, helped by better US domestic parcel volumes, higher international shipping prices and improved margins across all key segments. While operating profit was still down year-on-year, it beat both HSBC and market forecasts by 6–8%, suggesting the restructuring program is starting to pay off. The analyst argues that the share price has lagged FedEx, DHL and the broader S&P 500, leaving the stock relatively cheap at about 15 times forward earnings and offering a tempting 6% dividend yield for income-focused investors.

The bullish thesis on UPS hinges on a self-help story that is already in motion. Management has hit its 2025 cost-saving target of $3.5 billion by slashing nearly 27 million labor hours, eliminating 48,000 operational roles and shutting 93 facilities to better match capacity to demand as volumes from Amazon decline. For 2026, UPS plans to remove another 25 million labor hours, cut 30,000 more positions and close 24 additional buildings, while refreshing its aircraft fleet by retiring older MD-11 jets and bringing in more fuel-efficient Boeing 767s. A new arrangement with the US Postal Service to handle last-mile deliveries in its Ground Saver product is expected to further lower costs over the coming year.

Investors should not expect a smooth ride in the near term. UPS has guided to flat revenue in 2026 and slightly lower adjusted operating profit and margins compared with 2025, with the first quarter of 2026 likely to be particularly weak. The pressure will come from the continued “glide down” in Amazon volumes, extra lease expenses tied to the retirement of MD-11 aircraft, tough comparisons in international exports after tariff-related front-loading last year, and the ongoing ramp-up of the USPS partnership. However, management sees mid-2026 as the turning point, when those headwinds ease and the benefits of lower costs and a better mix of customers start to show up clearly in margins.

HSBC’s upgrade is also a bet that the market has become too pessimistic on UPS relative to peers. Over the last 12 months, including dividends, UPS shares have fallen about 15%, while the S&P 500 has gained 16% and FedEx and DHL have both advanced strongly. On valuation, UPS now trades slightly below its own historical price-earnings range and at a rare discount to FedEx, which the analyst views as an opportunity rather than a warning sign. The report notes that the stock is priced as if the current weakness will last, while the company is explicitly signaling a recovery in the second half of 2026 and into 2027, supported by upgraded margin and profit forecasts for that year.

There is also a notable read-across from the UPS call to DHL, another major global logistics player. While the upgrade is positive for UPS itself, HSBC flags that UPS’s weak international export volumes and declining European domestic volumes in the latest quarter, plus guidance for a sharp drop in international operating profit in early 2026, may spell near-term softness for DHL’s time-definite international business. At the same time, UPS’s success in pushing through higher export yields—up 7% in the fourth quarter—signals that pricing power in international express services is improving. For investors tracking the broader logistics sector, UPS now stands out as a restructuring-driven recovery story with income appeal, while DHL could face mixed volume trends but potentially better pricing dynamics ahead.

AGNC Investment, one of the best-known mortgage REITs focused on agency mortgage-backed securities, has lost some of its shine with analysts after a sharp rebound in its share price. KBW’s Bose George has downgraded AGNC from Outperform to Hold (Market Perform), even as he nudged his price target up from $11 to $12 on the back of rising book value since the third quarter. The shift reflects a view that the stock’s strong recovery and tighter agency MBS spreads have already captured much of the “easy” upside that comes early in a cycle. At around 1.3 times mark-to-market tangible book value, the new target suggests less room for multiple expansion unless conditions turn out better than base expectations.

The downgrade does not signal a bearish call on the business itself; in fact, the analyst’s outlook for the medium-term fundamentals of agency mortgage REITs remains constructive. AGNC continues to offer a hefty indicated dividend—about $1.44 annually, implying a yield near 12%—which is likely to keep income-oriented investors interested. However, KBW argues that the risk-reward is now more balanced: while downside appears better contained than in past periods of stress, further upside in book value and valuation multiples increasingly depends on favorable, less certain outcomes rather than the normalization that has already occurred. In other words, investors today are being paid for income rather than for a clear path to further capital gains.

At the same time, the report highlights emerging headwinds that could chip away at the story. One key concern is prepayment risk driven by regulatory changes, which could accelerate mortgage refinancing and reduce the spread income AGNC earns on its portfolio. Faster prepayments typically force mortgage REITs to reinvest at lower yields, pressuring returns. With agency MBS spreads already tighter, there is less cushion to absorb such shocks, making the stock more sensitive to policy shifts and interest-rate volatility. Against this backdrop, the analyst sees fewer obvious catalysts to drive a re-rating, especially after the strong rebound in valuations.

For investors, AGNC now looks more like a high-yield, lower-upside holding than a deep value recovery play. The upgraded price target acknowledges the improvement in book value but also effectively caps expectations for near-term capital appreciation. With the call moving to Market Perform, existing shareholders collecting the double-digit yield may be comfortable holding, but new buyers should be realistic about the trade-off: generous income in exchange for limited expected price gains and exposure to policy and prepayment risks that could quickly change sentiment in the mortgage REIT space.

Spotify has re-entered the growth spotlight, with Citi’s Jason Bazinet upgrading the streaming giant from Neutral to Buy and reaffirming an ambitious $650 price target. The bullish stance rests on three pillars: an attractive valuation, estimates that the analyst believes are conservative, and multiple potential catalysts on the horizon. At current levels, Spotify’s equity is valued at roughly 21 times forecast 2027 free cash flow per share, excluding the value of its cash and investments—a multiple the analyst views as compelling given the company’s scale, market position and improving profitability. The target price implies meaningful upside from today’s trading range.

Bazinet’s forecasts are incrementally more optimistic than the broader market consensus, particularly on revenue growth and profitability. He expects Spotify’s revenue to come in 1–2% above Street estimates, driven mainly by higher average revenue per user in its Premium subscription business, which he models at around 2% above sell-side expectations. On earnings, his adjusted EBITDA forecast is about 3% higher than consensus, underpinned by both the stronger topline and gross margins that he sees roughly one percentage point above the market’s view. Taken together, these assumptions suggest Spotify can outpace current forecasts without relying on heroics, providing room for positive earnings surprises.

The upgrade also leans on several concrete catalysts that could support a re-rating of the stock. First, additional price increases in key European markets could boost Premium ARPU and expand margins, especially if churn remains contained. Second, if rival digital streaming platforms also raise prices, Spotify’s risk of losing market share on price should fall, reinforcing its competitive position. Third, the company’s strong free cash flow and sizable cash balance create scope for stepped-up share buybacks, which would be welcomed by many investors after years of heavy investment in growth. Such capital return could signal confidence in the sustainability of Spotify’s cash generation.

Citi nonetheless flags two notable risks that investors should keep in mind. The first is strategic: Spotify might choose to deploy its cash to acquire an AI music startup or other technology-driven business. While the analyst believes this could be a smart move for the company’s long-term innovation, shareholders hungry for near-term buybacks may react negatively if they prefer immediate capital returns over acquisitions. The second risk is competitive: if rival platforms hold off on price hikes, investors might fear that Spotify’s own increases could push users away or that industry pricing power is weaker than hoped, putting long-term margin expansion at risk.

Even with these uncertainties, the tone of the call is clearly optimistic. The combination of a still-reasonable valuation on future free cash flow, expectations for modest outperformance versus consensus and a visible set of catalysts—pricing, industry behavior and buybacks—positions Spotify as a compelling growth name for investors willing to accept volatility. For those looking for exposure to digital consumer platforms with improving profitability, the upgrade reinforces Spotify’s status as a central player in the evolving global audio and music-streaming market.

Broadcom is drawing fresh enthusiasm from the semiconductor analyst community, with Wolfe Research’s Chris Caso upgrading the stock to Outperform and setting a $400 price target. The thesis centers squarely on the explosive growth of AI infrastructure and Broadcom’s key role in supplying custom AI accelerators, particularly Google’s Tensor Processing Units (TPUs). Wolfe’s checks indicate that TPU shipments could reach 7 million units annually by calendar 2028, positioning Broadcom as a major beneficiary of AI data center spending. The new target price is based on Broadcom’s potential to generate around $18 in earnings per share in a bullish 2027 scenario, valuing the stock at roughly 22 times that “earnings power” figure.

The upgrade reflects rising confidence in Broadcom’s AI revenue trajectory. For calendar 2026, the analyst now models AI-specific ASIC revenue of roughly $44 billion, tied to an estimated 3.3 million TPU shipments. By 2027, AI revenue is expected to jump to about $78.4 billion, assuming 5.1 million TPU units delivered. Importantly, TPUs are assumed to drive the majority of growth in Broadcom’s broader XPU portfolio (a term used to describe various types of compute accelerators), while other AI chip projects—such as those from Meta and the Open Accelerator Initiative—are treated as pure upside not fully baked into the base numbers. This conservative treatment of additional AI wins gives room for further upgrades if those ramps materialize.

Networking is another pillar of the AI story at Broadcom. The report estimates that AI-related networking revenue could reach $15.1 billion in 2026, up about 75% year-over-year, a growth profile that mirrors Wolfe’s expectations for Nvidia’s networking business. For 2027, AI networking revenue is projected to rise another 55% year-on-year. These figures highlight how critical high-speed connectivity has become in AI data centers, and they underscore Broadcom’s position as a key supplier of the switches and interconnects that tie massive AI clusters together. Notably, the analyst leaves estimates for Broadcom’s non-AI semiconductors and infrastructure software unchanged, emphasizing that the upgrade is driven almost entirely by AI momentum rather than by improvements in legacy businesses.

On valuation, Wolfe Research sees Broadcom’s potential 2027 earnings power at roughly $16 per share in its base case, implying that the stock currently trades at about a 25-times multiple of those future earnings, slightly above the 22-times multiple embedded in the $400 target but still below the company’s average valuation since the start of the AI spending cycle. The bull case assumes Broadcom can double its AI revenue again in 2027, pushing EPS to around $18 and justifying the target price. The analyst’s view is that the market has not fully reflected the scale of Broadcom’s AI opportunity, particularly as Google opens up its TPU technology to third parties, turning it into a serious rival to Nvidia’s GPU offerings.

For investors, the takeaway is that Broadcom has evolved into a central arms dealer in the AI compute race, with diversified exposure across custom accelerators and networking but without relying on every AI bet paying off. The unchanged outlook for non-AI segments offers a degree of stability, while the AI franchise provides the growth kicker that underpins the new Outperform rating. If AI infrastructure spending continues at the pace implied by current cloud provider roadmaps, Wolfe’s numbers suggest that Broadcom’s earnings could scale significantly over the next few years, making the stock a key candidate for investors seeking leverage to the long-term AI buildout.