Check out today's top analyst calls from around Wall Street, compiled by The Fly.
JEFFERIES LOWERS TESLA TO HOLD: Jefferies analyst Philippe Houchois downgraded Tesla (TSLA) to Hold from Buy with a price target of $800, up from $600. The analyst noted that he remains convinced by Tesla's "equity opportunity", but also believes that its valuation needs to be grounded on its potential market size and profitability. Houchois added that his neutral stance is warranted pending better visibility of the upcoming battery business model, even though he continues to see Tesla as "uniquely engaged in a positive sum-game" within the electric vehicle transition.
NOMURA CUTS NVIDIA TO REDUCE: Nomura Instinet analyst David Wong downgraded Nvidia (NVDA) to Reduce from Neutral with a price target of $230, down from $235. Risks to the global semiconductor industry posed by the coronavirus outbreak have grown over the last few weeks, Wong noted. Many investors and companies may have underestimated the risk of the current issues impacting electronics end market demand through 2020, added the analyst. Wong pointed out that Nvidia's Gaming segment accounted for 56% of total revenues in the January 2020 quarter. He considers the company's gaming graphics processing units and Nintendo Switchbased chips to be consumer discretionary items. Economic dislocations resulting from the coronavirus outbreak pose risk to demand in most electronic end markets, but the end markets associated with consumer purchases might have the most potential downside, said Wong.
BOFA DOUBLE DOWNGRADES MICRON, SILICON MOTION: BofA analyst Simon Woo double downgraded Micron Technology (MU) to Underperform from Buy with a $50 price target, and double downgraded Silicon Motion Technology (SIMO) to Underperform from Buy with a $40 price target. The analyst, who does not doubt a bottoming for memory in Q1, is concerned about earnings misses or guidance cuts for the March quarter. Memory stocks outperformed in 2019 and year-to-date in 2020, but consensus expectations are "too bullish" for Q2 and the second half of 2020, Woo said. The analyst does not see a strong earnings turnaround for the memory names from Q2 and Q3 as consensus expectations are embedding.
STEPHENS JOINS MORGAN STANLEY IN DOWNGRADING WAYFAIR: Stephens analyst Rick Nelson downgraded Wayfair (W) to Equal Weight from Overweight with a price target of $80, down from $95. Investor sentiment has shifted against Wayfair with the stock down almost 60% from the March 2019 high of $174, Nelson noted. With the company's revenue growth slowing and EBITDA losses widening, the analyst said he's not surprised by reports of job cuts. While Nelson finds Wayfair's 19% market share of the U.S. online home goods market is impressive, he questions whether market share peaks before profitability is achieved. In a "shaky market" investors will gravitate to profitable companies with valuation support, contended the analyst. As such, he moved to the sidelines with respect to Wayfair shares.
Of note, this is the second downgrade of the stock in as many days. On Monday, Morgan Stanley analyst Simeon Gutman downgraded Wayfair to Underweight from Equal Weight with a price target of $65, down from $75.
JEFFERIES, EVERCORE BOOST REGENERON: Jefferies analyst Biren Amin upgraded Regeneron (REGN) to Buy from Hold with a price target of $492, up from $355, after reports in an FDA database showed an elevated rate of vasculitis in patients treated with Novartis' (NVS) Beovu compared to Regeneron's Eylea. Two retina doctors he spoke to expect Beovu use to significantly decrease in the near-term, noted Amin, who raised his Eylea estimates to be ahead of consensus by $180M in 2020 and $450M in 2021 and 2022, respectively.
Evercore ISI analyst Joshua Schimmer upgraded Regeneron to Outperform from In Line with a price target of $500, up from $400, given his view that the "stumble" for competitor Novartis' Beovu "looks real."
