Check out today's top analyst calls from around Wall Street, compiled by The Fly.
BOEING, AIRBUS DOWNGRADED AT BERNSTEIN: Bernstein analyst Douglas Harned downgraded Boeing (BA) and Airbus (EADSY) to Market Perform from Outperform with a $165 price target and EUR 69 price target, respectively. The analyst believes recoveries in airline traffic and plane deliveries will take longer than previously expected amid the COVID-19 pandemic. Harned tells investors in a research note that there's "no evidence" that FAA's re-certification of Boeing's 737 Max will take place this month despite news reports of such plans. And while the production standstill reduces Boeing's cash risk, the company remains under "high pressure" from customers to return pre-payments on the Max, adds the analyst.
Additionally, Harned is "skeptical" that airlines' demand justifies Airbus's A320neo model production rate of 40 planes per month this year, and he thinks wide-body output will also need to be slowed.
EBAY UPGRADED AT DEUTSCHE: Deutsche Bank analyst Kunal Madhukar upgraded eBay (EBAY) to Buy from Hold with a price target of $57, up from $42. Deutsche's survey suggests new buyers on the eBay platform have had a positive experience, with over 40% stating they are "very likely" to make a purchase over the next six months, and another ~20% saying they are "somewhat likely," Madhukar tells investors in a research note. Further, the analyst views consensus estimates for eBay as "extremely conservative" and thinks the full benefit of the Payments business is not yet completely incorporated into the numbers. The shares are attractive relative to the S&P 500 and retail stocks on a price-to-earnings multiple, and the valuation becomes even more attractive when factoring in the potential for share repurchase post the Classifieds sale, says Madhukar.
DRAFTKINGS RATED BUY AT ROSENBLATT: Rosenblatt analyst Bernie McTernan initiated coverage of DraftKings (DKNG) with a Buy rating and $60 price target. He believes online players will take the dominant share as the gambling industry in the U.S. emerges and sees the company being an industry leader, McTernan tells investors. In his bull case, he believes the stock "can triple," McTernan added.
INOVIO DOWNGRADED TO HOLD: Stifel analyst Stephen Willey downgraded Inovio Pharmaceuticals (INO) to Hold from Buy with a price target of $24, up from $19. The over $6B fully diluted valuation more appropriately reflects a balanced risk/reward profile ahead of approaching events, Willey tells investors in a research note. While peer COVID-19 vaccine company valuations suggest possible significant further upside in the shares should promising immunogenicity data and a large government check materialize, any potential downside risk in the absence of the aforementioned events occurring is "equally-significant," says the analyst. Despite downgrading, Willey says the "significant socioeconomic importance of a viable COVID-19 vaccine candidate creates a scenario whereby hope/sentiment displaces valuation," and that he believes Inovio's core DNA vaccine technology has remained mostly underappreciated relative to competitive platforms.
NIKE'S 'CONSUMER DIRECT ACCELERATION' STRATEGY TO DRIVE SALES GROWTH: BTIG analyst Camilo Lyon keeps his Buy rating and $117 price target on Nike (NKE) after its Q4 earnings, noting that while the results were far worse than expected with a 38% decline in revenue and 822bps gross margin compression, its 'Consumer Direct Acceleration' strategy should drive faster sales growth. The analyst believes that margins will also expand as the company reallocates investment dollars to higher-returning opportunities that more directly connect Nike with its consumers. Lyon further cites Nike's current quarter-to-date commentary on the accelerating recovery in China, along with double digit growth at retail and triple digit growth in digital in North America, as positives in recent weeks.
Meanwhile, Wells Fargo analyst Tom Nikic raised the firm's price target on Nike to $110 from $99 and keeps an Overweight rating on the shares following the company's "very challenging" Q4 as COVID-19 had a profound impact. Nikic says Q4 was a bad quarter, but it's understandable given the external environment and thinks much more important is the fact that the brand remains hot, the company continues to roll out new innovations, the COVID pandemic may put a greater consumer emphasis on health/wellness and the company has one of the best Digital platforms in the apparel/footwear universe. Goldman Sachs analyst Alexandra Walvis raised the firm's price target on Nike to $110 from $96 and reiterates a Conviction Buy rating on the shares. Nike's fiscal Q4 results and update on COVID-19 disruption pointed to "resilient" sales and business trends in the company's digital business, Walvis says. Nike's Q4 sales and margin were disappointing but it was largely overshadowed by the strong performance so far quarter-to-date across most regions and management's plans to accelerate its "Consumer Offense strategy," Citi analyst Paul Lejuez adds.
