Check out today's top analyst calls from around Wall Street, compiled by The Fly.
APPLE STARTED WITH AN OUTPERFORM AT COWEN: Cowen analyst Krish Sankar initiated Apple (AAPL) with an Outperform rating and $220 price target, stating that his long term investment thesis hinges on the Services segment growing and Apple massively monetizing its installed base of products. Sankar also thinks increasing recurring revenues should drive a higher multiple for Apple shares, he tells investors. He models iPhone units down 15% year-over-year in calendar 2019 to 175M units.
SNAP UPGRADED TO BUY AT BTIG: BTIG analyst Richard Greenfield upgraded Snap (SNAP) to Buy from Neutral with a price target of $15, citing the "surge in spending in North America on Snapchat from advertisers," who are increasingly focused on its "compelling" return on investment. The analyst stated that the low relative bid prices on advertising inventory for Snap started in Q3 and "really picked up" in Q4, anticipating direct impact on the company's revenue in 2019. Greenfield also cited the "meaningful reduction in clickbait/seedy influencer content" in Snap's Discover section and an increase in the "premium/publisher content -- illustrating a change in the underlying algorithm, along with improved morale relative to "all-time lows" in 2018 after hiring of a number of new senior executives.
LEXICON CUT TO SELL AT GABELLI: Gabelli analyst Kevin Kedra downgraded Lexicon (LXRX) to Sell from Hold, citing his expectation that the FDA will reject sotagliflozin in type 1 diabetes by its March 22 PDUFA date following a split AdCom vote in January. He believes the FDA is likely to require additional information regarding a risk mitigation strategy to reduce incidences of diabetic ketoacidosis in type 1 patients on sotagliflozin, which is "a manageable hurdle," but one that will likely take additional time to navigate, Kedra told investors. He has reduced his 2020 private market value estimate for Lexicon shares to $6.00 from $6.50.
GENERAL MILLS BOOSTED TO BUY AT DEUTSCHE: Deutsche Bank analyst Rob Dickerson upgraded General Mills (GIS) to Buy from Hold and raised his price target for the shares to $54 from $43. Although the stock is up 20% year-to-date, pressure still exists in the company's snack bar and soup categories, and divestment dilution risk looms, Dickerson told investors in a research note. However, he believes the core U.S. base business at General Mills "seems to have stabilized" and that the opportunity with Blue Buffalo "remains underappreciated." He sees some reluctance by investors to buy General Mills' shares despite strengthening U.S. retail data trends and margin-accretive distribution and share gain potential with pet at Walmart. The analyst believes share upside potential exists.
ROKU PRICE TARGET RAISED TO $85 AT NEEDHAM: Needham analyst Laura Martin raised her price target on Roku (ROKU) to $85 from $65and kept her Buy rating, saying its 14% stock price decline Wednesday was "overdone" while maintaining her view of the company as the "top pick for 2019". The analyst cited the company's position of an "arms dealer", aggregating 5K 3rd party streaming video apps into one platform. She also believes that "every new streaming service", including the upcoming offerings from Disney (DIS), AT&T (T) and Apple (AAPL) will sign contracts allowing for viewing on Roku device, adding that "TV advertisers" will have to follow the viewers since some 10M Roku users have no linear TV access. Moreover, Martin contended that Roku is in position to expand internationally or possibly be acquired.
