22 Feb Here are Thursday’s biggest analyst calls: NVDA, RIVN, RUN, DASH
Here are Thursday’s biggest calls on Wall Street: Morgan Stanley raises Nvidia price target Morgan Stanley increased its price target on shares to $795 from $750 after the chipmaker’s earnings announcement. ” NVIDIA beat and raise vs. our increased estimates; perhaps more importantly, resizing the inference market and characterizing supply chain issues points to ongoing durability.” UBS reiterates Nvidia as buy, but trims price target UBS reiterated its buy rating on Nvidia but reduced its price target to $800 from $850. “The bottom line is that we are still in such early stages of what is possible with AI (especially health care/drug discovery) and NVDA is the de-facto global AI platform, it seems too soon to take a more cautious view. We are trimming estimates a bit to reflect some potential slowing in revenue growth and price target goes from $850 to $800 but we maintain our Buy.” Goldman Sachs reiterates buy rating on Nvidia Goldman raised its price target to $875 from $800, noting new products could augment “what is already a robust demand backdrop.” ” Nvidia delivered against what was seemingly a very high bar with Data Center once again serving as the key growth driver. … Looking ahead… We expect not only sustained growth in Gen AI infrastructure spending by the large CSPs and consumer internet companies, but also increased development and adoption of AI across enterprise customers representing various industry verticals and, increasingly, sovereign states.” Morgan Stanley upgrades DoorDash to overweight from equal weight Morgan Stanley’s upgrade comes after the stock fell around 10% since its earnings report on Feb. 15. “While the pullback was driven by investor concerns surrounding investment levels, competitive dynamics and forward guidance achievability, we have confidence in DASH ‘s forward GOV and EBITDA growth as detailed below, supported by a durable US Restaurant business which we estimate on a standalone basis currently trades at a ~6% ’25 FCF yield.” RBC reiterates Rivian Automotive as sector perform RBC said Rivian could be in trouble as the EV market stays under pressure. ” Rivian reported a messy Q4 with worse FCF vs expectations but more importantly issued 2024 production guidance well below consensus. … We would expect shares to come under pressure.” Morgan Stanley reiterates overweight rating on Rivian Automative Morgan Stanley kept its overweight rating on Rivian , but cited concerns on the company’s outlook. “While consumers love the R1 and investors would love a ‘non-Tesla’ way to play the long-term EV theme, Rivian’s results continue to largely disappoint, whether on volume or margin progression. … The EV landscape has changed decidedly for the worse since Rivian’s November 2021 IPO, yet – tweaks aside – the company’s strategy appears to have been largely unchanged.” UBS upgrades YPF to buy from neutral UBS upgraded the stock to buy from neutral, citing Petrobras’ improvement as a benchmark for the Argentine oil company. “We see indications that oil & gas operators may be able to operate freely, possibly supporting: 1) YPF ‘s pricing policy in oil and, mainly, fuel; 2) reduced capex and overall expenses; and 3) a potential re-rating, due to the two aforementioned points and eventual macro improvement in the country.” Jefferies reiterates Sunrun as buy Jefferies also raised its price target on Sunrun to $31 from $25, implying shares nearly doubling from Wednesday’s close. “Sunrun is well poised to take advantage of the growth in resi solar after a disappointing 2023. We see upside to Sunrun’s NSV driven by cost deflation, ITC adders and product mix shift to solar + storage vs solar only.” Bernstein downgrades Wendy’s to market perform from outperform The firm said growth expectations should be tempered in the near term. “We believe Wendy ‘s expected growth in breakfast is too optimistic and the SSS growth algorithm is too dependent on the breakfast acceleration. … While we appreciate the $55M investment to support the growth, we believe the target of 50% increase in avg weekly breakfast sales per unit in the next 2 years might be too ambitious, in the context of moderating daypart growth; the increasing competition in that daypart might expose Wendy’s to the risk of missing guidance, in absence of more growth drivers.” TD Cowen upgrades Coty to outperform from market perform TD Cowen says it is incrementally positive on the global beauty company’s top- and bottom-line growth outlook. ” COTY is a premiumizing diversified global beauty powerhouse now driving best practices & prudent investments in attractive categories/geographies. We expect continued momentum in fragrance (~55% mix), innovation in Consumer Beauty & global growth including China/Brazil.” Cantor Fitzgerald upgrades Root to overweight from neutral Cantor said profitability for the fintech company will be tough to achieve in the near term. “With positive year-to-date trends, we believe Root is well-positioned to gain profitable market share in 2024E by continuing to execute on the strategy it has implemented over the last two quarters.” Morgan Stanley says big-tech ‘under-owned’ compared to the S & P 500 “Under-ownership of mega-cap tech stocks was largely unchanged at -79bps exiting 4Q23 vs. +29bps for the rest of large-cap tech. MSFT remains the most under-owned mega cap tech stock we track, and META is most over-owned.” BMO Capital Markets upgrades Remitly Global to outperform from market perform BMO cited strong quarterly results and “stable underlying marketing efficiency QoQ” for the upgrade. “We believe investors underestimate Remitly ‘s long-term growth potential and EBITDA margin trajectory; we see upside to the FY24 guide (which surprised positively) and longer-term consensus expectations.”