Check out today's top analyst calls from around Wall Street, compiled by The Fly.
PIPER RAISES CANOPY GROWTH PRICE TARGET: Piper Jaffray analyst Michael Lavery raised his price target for Canopy Growth Corporation (CGC) to $60 from $40 and kept an Overweight rating on the shares. Lavery continues to estimate a $250B-$500B potential long-term global cannabis market, with a $15B-$50B near-term opportunity. Canopy is well positioned in the growing cannabis market, which is transitioning from illicit trade to legal sales, Lavery tells investors in a research note titled "A (US) Journey Of A Thousand Miles Begins With The First Step..." He considers Canopy's recent approval of a New York hemp license to be a "tangible first step forward" in the U.S. that points to the beginning of a "long" U.S. growth trajectory. In late morning trading, shares of Canopy Growth are higher by 6.5% to $47.10.
TWO FIRMS CUT INTEL TO HOLD-EQUIVALENT: Susquehanna analyst Christopher Rolland downgraded Intel (INTC) to Neutral from Positive. The analyst cited the combination of decelerating data center growth, narrowing process technology leadership, and macro concerns. Rolland lowered his price target to $50 from $58 on Intel shares.
Needham analyst N. Quinn Bolton downgraded Intel to Hold from Buy, saying that while he had already reduced estimates across the semiconductor sector following CES on weaker macro backdrop, the company's latest Q4 results were below those revised expectations. The analyst cited cloud customers having "pivoted from capacity addition to inventory absorption" late in Q4, while the slowdown in China also "created excess inventory in the enterprise segment." With Data Center Group -- Intel's largest growth driver -- "simultaneously experiencing decelerating demand and facing tough comps over the next two to three quarters", Bolton said a move to the sidelines and monitoring of signs for data center spending recovery are warranted. Following the two downgrades, shares of Intel are lower by 6.15% to $46.70.
ANALYSTS POSITIVE ON PG&E AFTER REPORT: RBC Capital analyst Shelby Tucker raised his price target on PG&E (PCG) to $16 from $8 after the CAL FIRE determination that its equipment was not responsible for the Tubbs Fire that resulted in $8B in economic losses. The analyst noted that the company's intent toward bankruptcy will be questioned, but also sees the ruling as supportive of its "quest to repeal condemnation for investor-owned utilities in California." Tucker kept his Sector Perform rating on PG&E given the continued uncertainty surrounding its potential liabilities in the 2017 and 2018 wildfires.
JPMorgan analyst Christopher Turnure said Thursday's report from the California Department of Forestry and Fire Protection is a "clear positive" for PG&E. With the report finding that PG&E wires were not the source of ignition for Tubbs Fire, the analyst now assumes the company is largely absolved of an estimated $7B of liabilities. Despite this favorable finding, PG&E continues to face roughly $28B of gross fire liabilities, Turnure said. The primary challenges are that potential liabilities continue to exceed the financing capacity of the company, added the analyst. He believes PG&E will face years of litigation stemming from the 2017-2018 wildfires absent its potential bankruptcy filing. Turnure raised his price target for the shares to $11 from $10 and kept a Neutral rating on PG&E. Shares of PG&E are lower by 14.77% to $11.89 in late morning trading.
BARCLAYS UPGRADES AVAYA TO OVERWEIGHT: Barclays analyst Raimo Lenschow upgraded Avaya (AVYA) to Overweight from Equal Weight and raised his price target for the shares to $21 from $20. The analyst sees over 40% upside for the stock despite the company's status as a "legacy tech vendor." Since its return from bankruptcy in January 2018, Avaya has been largely ignored by equity investors and is trading at very low multiples, Lenschow tells investors in a research note. A return to legacy tech peer multiples alone could result in significant share price appreciation, says the analyst. He believes ongoing execution towards Avaya's fiscal 2019 revenue growth targets and better cash conversion will be positive catalysts. Following the upgrade, shares of Avaya are higher by 8.35% to $15.83 in late morning trading.
