Investing

Top Analyst Upgrades and Downgrades: AT&T, Chipotle, eBay, Intel, Nucor, Occidental, Schlumberger, Snap, United Rentals and More

Jon C. Ogg

Published: October 22, 2018 9:00 am

Last Updated: January 11, 2020 4:05 pm

Stocks were indicated to open higher on Monday after a surge in China from intervention is offering further support, with income-tax changes pledged on Chinese media. Investors have seen lower upside after buying immediately after the big market pullbacks in 2018 than in prior years. And now the investing community needs to consider how to position investments for the rest of the year and into 2019.

24/7 Wall St. reviews dozens of analyst research reports each day of the week to find new ideas for investors and traders alike. Some analyst reports cover stocks to buy, but others cover stocks to sell or to avoid.

Additional commentary has been added on most of the daily analyst reports, along with trading history. The consensus analyst price targets and other valuation metrics are from the Thomson Reuters sell-side research service.

These are the top analyst upgrades, downgrades and initiations seen on Monday, October 22, 2018.

AT&T Inc. (NYSE: T) was raised to Buy from Neutral at Tigress Financial Partners. The stock closed up 1.1% at $32.87 on Friday and was indicated up 0.5% at $33.03 on Monday. It has a 52-week trading range of $30.13 to $39.33 and a consensus target price of $35.48.

Chipotle Mexican Grill Inc. (NYSE: CMG) was upgraded to Outperform from Sector Perform and the price target was raised to $510 from $450 at RBC Capital Markets, with the firm noting Chipotle’s same-store sales growth potential.

Crown Holdings Inc. (NYSE: CCK) was raised to Outperform from Market Perform and the target price was set at $60 at Wells Fargo.

eBay Inc. (NASDAQ: EBAY) was downgraded to Neutral from Buy with a $33 price objective (versus a $28.75 prior close, after an 8.9% drop) at Merrill Lynch. Shares were down sharply after PayPal previews eBay gross merchandise valuation deceleration (to 3% from 6% in the second quarter). Merrill Lynch said eBay appears to be growing more in line with retail than e-commerce, and the firm now assumes that the company is contemplating cost cutting or announcing other broader strategic actions.

Ecopetrol S.A. (NYSE: EC) was raised to Market Perform from Underperform at Raymond James.

Entasis Therapeutics Inc. (NASDAQ: ETTX) was started as Outperform and assigned a $19 price target (versus a $7.44 close) at Wedbush Securities. The firm noted its next-generation drugs for next-generation bugs with a pipeline of new antibiotics targeted to resistant bacterial infections. Also, Credit Suisse started it as Outperform and assigned an $18 price target.

Honeywell International Inc. (NYSE: HON) was reiterated as Buy at Argus after recent weakness, with the firm noting that the recent weakness offers a buying opportunity for new shareholders.

Intel Corp. (NASDAQ: INTC) was raised to Buy from Neutral at Nomura/Instinet. Intel closed down 2.16% at $44.00 on Friday but was indicated up about 1.1% at $44.50 on Monday. Intel has a 52-week range of $40.40 to $57.60 and a consensus price target of $55.26.

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Nucor Corp. (NYSE: NUE) was reiterated as Buy at Argus, with the independent research outfit saying that the recent weakness offers a buying opportunity for new buyers.

Occidental Petroleum Corp. (NYSE: OXY) was raised to Strong Buy from Outperform at Raymond James. It closed up 0.4% at $72.18 on Friday and was indicated up 1.5% at $73.25 on Monday.

Old Dominion Freight Line Inc. (NASDAQ: ODFL) was downgraded to Equal Weight from Overweight and the price target was lowered to $146 from $160 (versus a $132.06 close) at Morgan Stanley.

Schlumberger Ltd. (NYSE: SLB) was maintained as Outperform after earnings at Credit Suisse, but the firm lowered earnings estimates and lowered its target price to $71 from $82. Schlumberger closed up four cents at $58.47 on Friday and was indicated up 0.5% at $58.75 on Monday. Its 52-week range is $57.59 to $80.35, and that 52-week low was put in on Friday morning.

Snap Inc. (NYSE: SNAP) was maintained as Outperform but the price target was lowered to $12 from $15 at Credit Suisse, with the firm noting that it is kicking the potential positive catalyst can down the street. The stock closed flat at $6.81 on Friday, and the 52-week range is $6.46 to $21.22.

Sutro Biopharma Inc. (NASDAQ: STRO) was started as Outperform and assigned a $20 price target (versus a $14.53 close) at Wedbush, which noted that Sutro is climbing to the peak of ADC technology after having received an orphan drug designation for multiple myeloma earlier in October.

Union Pacific Co. (NYSE: UNP) was downgraded to Underweight from Equal Weight and the target price was lowered to $134 from $141 at Morgan Stanley.

United Rentals Inc. (NYSE: URI) was raised to Buy from Hold at Argus after the post-earnings weakness was said to have knocked off too much value last week. The stock closed down almost 1% at 117.12 on Friday, after taking a larger post-earnings drop, and its shares are now down from a 52-week high of $190.74.

Wingstop Inc. (NASDAQ: WING) was downgraded to Neutral from Outperform with a $74 price target (versus a $70.79 close) at Wedbush. It was said to be priced now at a valuation that largely incorporates investor expectation of comparable sales growth, unit growth and free cash flow upside in 2019.

Credit Suisse’s U.S. Equity Strategy team is out with a post-selling note, saying that volatile markets take time to heal. While the firm believes that investors should opportunistically extend risk when volatility jumps, it has pointed out that it’s not unusual for markets to remain jittery for some time (perhaps two to three months) following a spike in the VIX. The firm also noted that bear markets are associated with recession and liquidity events, but there are few indications of contagion at this time, a bullish signal for stocks.

Check out the 10 speculative stocks that have received analysts calls for 50% to 300% in implied upside within the past 10 days.

Friday’s top analyst calls included Alphabet, American Express, Apple, Biogen, eBay, Ford, Microsoft, PPG, Roku, United Rentals, Valero Energy and many more.