Check out today's top analyst calls from around Wall Street, compiled by The Fly.
CATERPILLAR CUT TO SELL AT UBS: UBS analyst Steven Fisher double downgraded Caterpillar (CAT) to Sell from Buy and cut his price target for the shares to $125 from $154. The analyst believes ~55% of Caterpillar's end markets will peak in 2019, pressuring revenue and margins in 2020 as demand declines. Continued growth in mining and share buybacks will not be enough to offset headwinds in construction and oil and gas, Fisher told investors in a research note. He expects Caterpillar's earnings will decline 8% year-over-year in 2020 and believes this is not priced into the shares. Consensus earnings estimates, which imply 8% year-over-year earnings growth in 2020, are 16% too high, says Fisher. As such, he expects downward earnings revisions to pressure Caterpillar shares over the next 12 months.
EXACT SCIENCES UPGRADED TO BUY AT GOLDMAN: Goldman Sachs analyst Patrick Donnelly upgraded Exact Sciences (EXAS) to Buy from Neutral and raised his price target for the shares to $120 from $85. The current momentum of the Cologuard commercial ramp provides "strong basis" for the company's premium valuation while the combination of positive Cologuard catalysts and new product roll-outs provide upside to current levels, even after the stock's 75% rally since the beginning of 2018, Donnelly told investors in a research note. He views the Cologuard product cycle as the "most compelling across all of diagnostics." Exact Sciences is a "must-own growth stock" given the "clean runway forward that is largely in its control with potential for discovery value in the pipeline outside of Cologuard," the analyst contended. Donnelly believes the company's story is only strengthening and sees the stock as poised to continue its outperformance moving forward.
FOOT LOCKER CUT TO HOLD AT PIVOTAL: Pivotal Research analyst Mitchel Kummetz downgraded Foot Locker (FL) to Hold from Buy with an unchanged price target of $64. The analyst sees a less favorable risk/reward into the company's Q4 results on March 1. The analyst expects "solid" Q4 results but believes the company's Q1 is likely off to a slow start. An easy two-year comparison may not be enough for Foot Locker to generate solid Q1 same-store-sales, as the quarter is likely off to a slow start on delayed/reduced tax refunds, Kummetz tells investors in a research note. Further, he does not expect this deficit to be fully reversed over the balance of the quarter.
PALO ALTO CUT TO MARKET PERFORM AT NORTHLAND: Northland analyst Robert Breza downgraded Palo Alto Networks (PANW) to Market Perform from Outperform, stating that he expects upside to Q2 revenue and EPS given the company's track record of earnings beats, but he also expects EPS to be guided down as the company invests for growth while absorbing the Demisto acquisition. Breza, who sees the risk/reward as negatively biased ahead of tonight's report, has a $240 price target on Palo Alto shares.
CANOPY, TILRAY COULD BENEFIT FROM WHO RECLASSIFICATION: The World Health Organization plans to recommend rescheduling marijuana and cannabis resin to the least restrictive classification, Piper Jaffray analyst Michael Lavery told investors in a research note. The agency is also proposing that cannabidiol be "not under international control" at all, added the analyst. He believes these actions could facilitate exports and imports between countries, which he would consider positive for both Canopy Growth (CGC) and Tilray (TLRY). Separately, in the U.S., 12 members of Congress recently requested the FDA to provide updated guidance on food products containing cannabidiol, reflecting a desire for the FDA to detail its regulatory plans, says Lavery. The analyst has an Overweight rating and $60 price target on Canopy and Overweight rating and $90 price target on Tilray.
