Check out today's top analyst calls from around Wall Street, compiled by The Fly.
RAYMOND JAMES, BOFA DIVERGE ON FIRST SOLAR: Raymond James analyst Pavel Molchanov upgraded First Solar (FSLR) to Outperform from Market Perform with a $65 price target. In a research note to investors, Molchanov noted that this is the first time since 2010 that he is turning positive on First Solar, saying the backdrop is the best all-around investor sentiment on clean tech in more than a decade. The analyst said that First Solar is one of the few remaining value ideas in clean tech, and thinks risk/reward is nicely tilted to the upside.
However, BofA analyst Julien Dumoulin-Smith double downgraded First Solar to Underperform from Buy with a $54 price target. Following the company's "execution hurdles" in fiscal 2019, the analyst sees First Solar's lower than expected fiscal 2020 guidance and announced strategic review of the Systems business as underscoring a "materially lower profile" at the Systems unit. Further, Dumoulin-Smith's channel checks with developers point to an increasing competitive development landscape with compressed margins and reduced risk adjusted returns.
MORGAN STANLEY CUTS WAYFAIR TO UNDERWEIGHT: Morgan Stanley analyst Simeon Gutman downgraded Wayfair (W) to Underweight from Equal Weight with a price target of $65, down from $75. Wayfair's fundamentals deteriorate when the market is less tolerant of unprofitable online retailers, Gutman told investors in a research note. Further, he believes a recovery at the company may be prolonged due soft near-term trends and macro risks. As such, the stock's risk/reward "skews negative," Gutman said. Further, the analyst's analysis suggests the stock's "true bear value is lower than perceived." He believes the market is pricing in greater stabilization in 2020 revenue trends and a faster path to profitability than he expects for Wayfair. Channel checks suggest the company's revenue growth is still decelerating, and macro headwinds are rising, the analyst contended.
COWEN DOWNGRADES CANADIAN CANNABIS COMPANIES: Cowen analyst Vivien Azer downgraded Aurora Cannabis (ACB), Sundial Growers (SNDL), and Tilray (TLRY) to Market Perform from Outperform. The analyst has grown increasingly cautious on the outlook for cannabis in Canada and prefers U.S. cannabis names to its Canadian peers. Headwinds plaguing the industry include concerns on pricing, stores and inventory, and they have not faded as anticipated.
STEPHENS CUTS VULCAN MATERIALS, MARTIN MARIETTA: Stephens analyst Trey Grooms downgraded Vulcan Materials (VMC) to Equal Weight from Overweight with a price target of $150, down from $177. After the company's Q4 results "missed across the board," Grooms said higher costs were expected, but not of this magnitude. Additionally, he sees higher demand uncertainty given the recent slowing of highway contract awards, difficult comps, uncertainty around how state DOTs will handle lettings in 2020 and "choppy leading indicators" for non-residential housing, Grooms added.
Grooms also downgraded Martin Marietta Materials (MLM) to Equal Weight from Overweight with a price target of $280, down from $309. In Q4, infrastructure shipments took a pause in several geographic markets with Martin Marietta infrastructure related shipments down year-over-year, Grooms noted. The analyst believes the backdrop of weakening highway contract awards "creates further question around the timing." This, when combined with "choppy" leading indicators for non-residential, and some concerns around how states will handle lettings ahead of the FAST Act expiring, creates uncertainty around the demand picture, contended Grooms. As such, the analyst thinks Martin Marietta shares "could take a pause until we get more clarity."
NEEDHAM CUTS AGILENT TO HOLD: Needham analyst Stephen Unger downgraded Agilent (A) to Hold from Buy after its in-line Q1 and below-consensus Q2 guidance. The analyst said that revenue would have decelerated even without the impact of the coronavirus business disruption in China, adding that while he sees the company's FY20 outlook as achievable, there is "clearly less potential" for meaningful upside.
