Check out today's top analyst calls from around Wall Street, compiled by The Fly.
EVERCORE CUTS TESLA TO UNDERPERFORM: Evercore ISI analyst Arndt Ellinghorst downgraded Tesla (TSLA) to Underperform from In Line citing his more cautious view on demand for its vehicles, in particular the recent "severe decline" in demand for the Model S and Model X. Given the demand concerns, Ellinghorst cut his delivery forecasts for 2019, 2020 and 2021 and lowered his 2020 EPS estimates by 40%. He also expressed concern that the company has been taking repeated "cost-cutting measures" designed to conserve cash, when a "proper capital raise" would alleviate liquidity concerns, Ellinghorst told investors. He lowered his price target on Tesla shares to $240 from $330.
GMP SECURITIES BOOSTS CANOPY GROWTH TO BUY: GMP Securities analyst Martin Landry upgraded Canopy Growth (CGC) to Buy from Hold after the company confirmed a deal giving it the right to acquire Acreage Holdings (ACRGF) upon cannabis production and sale becoming federally legal in the U.S., giving Canopy exposure to the largest cannabis market in the world. He sees significant near-term synergies and believes "the price is right," arguing that the takeout multiple is low given the strategic nature of the acquisition and Acreage's potential for continued strong growth. Landry raised his price target on Canopy shares to C$72 from C$65.
B. RILEY UPGRADES LAM RESEARCH TO BUY: B. Riley FBR analyst Craig Ellis upgraded Lam Research (LRCX) to Buy from Neutral and raised his price target for the shares to $235 from $170. The analyst sees "increasingly visible recent signs" of a cyclical trough in Q1. Further, his analysis shows a "strong" NAND wafer start rebound is likely in 2020 after 2019's year-over-year drop. In addition, Lam's $5B share buyback could bring upside to consensus estimates, Ellis told investors in a research note. He projected in-line fiscal Q3 estimates from Lam and sees only moderate estimate risk for Q4.
MIZUHO CUTS OCCIDENTAL TO NEUTRAL: Mizuho analyst Paul Sankey downgraded Occidental Petroleum (OPC) to Neutral from Buy and lowered his price target for the shares to $70 from $83. The analyst said reports of Occidental bidding for Anadark (APC) are "well outside" his "prior understanding of company strategy." A bid for Anadarko would imply either a total change in strategy or a need for free cash flow that would be provided by Anadarko on the part of Occidental, Sankey tells investors in a research note. The latter would imply Occidental's future "dividend growth or even dividend cover is not as strong as we had assumed," he added.
RAYMOND JAMES BOOSTS RENT-A-CENTER TO STRONG BUY: Raymond James analyst Budd Bugatch upgraded Rent-A-Center (RCII) to Strong Buy and raised his price target to $27 from $25 ahead of its Q1 results on May 6. The analyst noted that the financial performance of the company has "improved significantly from the depths of the past few years" and also points to the management's efforts to restructure and refinance its high-cost debt as discussed in the company's Q4 earnings call. Bugatch added that his projections now calls for the Rent-A-Center board to re-initiate a cash dividend by Q4 of this year and for its "improving balance sheet" to become net cash positive by 2021.
