Investing

Top Analyst Upgrades and Downgrades: AEP, Apple, Baker Hughes, BofA, Carnival, Cree, Exxon, JPMorgan, Microsoft, Qualcomm, Under Armour, UPS and More

Jon C. Ogg

Published: March 10, 2020 8:48 am

Stocks were handed a massive one-two punch from the coronavirus and the Saudi-Russian oil price war on Monday, with the Dow Jones industrials closing down just over 2,000 points (7.8%) at 23,851.02 and the S&P 500 closing over 225 points (7.6%) lower at 2,746.56. Tuesday’s index levels were set for a big recovery of more than 900 points on the Dow and over 110 points on the S&P 500 after President Trump is floating the idea of a payroll tax deduction.

In an effort to find new ideas for our readers, 24/7 Wall St. reviews dozens of analyst research reports each day of the week. Some of the daily analyst calls cover stocks to buy, while some calls cover stocks to sell or to avoid. We have seen consensus target prices and earnings expectations on the market leaders coming down, but there has not been outright panic in the strong companies. As with all analyst reports, these should be individually verified and only used as one tool in an investment decision process.

With the exception of the massive drop in oil on Monday, most analysts have so far avoided screaming for the market panic buttons and yelling “Sell, Mortimer! Sell!” to their clients. The near-term and longer-term trading reactions will determine whether that was the right stance.

We have provided these analyst calls in a quick-hit summary for easy reading, and additional comments and trading data have been added on many calls. The consensus analyst price targets and other valuation metrics are from the Refinitiv sell-side research service. These are the top analyst upgrades, downgrades and initiations from Tuesday, March 10, 2020.

Activision Blizzard Inc. (NASDAQ: ATVI) was raised to Outperform from Perform and was given a $68 target price at Oppenheimer. Shares closed down 4.37% at $57.35 on Monday, and the consensus target price was $67.24.

Allegion PLC (NYSE: ALLE) was raised to Neutral from Underperform and the target price was lowered to $112 from $118 (versus a $115.00 prior close) at Credit Suisse.

American Electric Power Co. Inc. (NYSE: AEP) was raised to Overweight from Equal Weight but the target price was lowered to $102 from $110 at Morgan Stanley. AEP closed down 2.8% at $94.96 on Monday, with a prior $105.25 consensus target price.

Apple Inc. (NASDAQ: AAPL) was maintained as Buy but the target price was trimmed to $335 from $355 at UBS. The firm was among the first of the larger brokerages to trim its target price after the sell-off, and more calls like this probably should be expected.

Baker Hughes Co. (NYSE: BKR) was raised to Overweight from Neutral with an $18 target price (versus a $12.50 close, after a 22.25% drop) at JPMorgan.

Bank of America Corp. (NYSE: BAC) was reiterated as Neutral and the target price was cut to $30 from $37 at Citigroup.

Carnival Corp. (NYSE: CCL) was downgraded to Neutral from Buy with a $32 target price (versus a $21.74 close) at Goldman Sachs. The stock is down from a high of $57.69 a share.

China Online Education Group (NYSE: COE) was started as Buy with a $36 target price (versus a $29.00 close) at Needham.

CNOOC Ltd. (NYSE: CEO) was downgraded to Underperform from Hold at Daiwa. The American depositary shares closed down 15% at $110.12 on Monday along with the collapse in oil prices.

Cree Inc. (NASDAQ: CREE) was raised to Neutral from Underweight with a $38 target price (versus a $38.88 prior close, after an 11.4% drop) at JPMorgan.

Dollar Tree Inc. (NASDAQ: DLTR) closed up 4% at $83.51 on Monday despite the sell-off. UBS maintained its Buy rating but lowered its target price to $98 from $108.

DuPont de Nemours Inc. (NYSE: DD) was maintained as Buy at UBS, but the firm lowered its target price to $80 from $86. DuPont closed down 13.2% at $35.15 on Monday, with a prior $67.76 consensus target price.

Eversource Energy (NYSE: ES) was downgraded to Underweight from Equal Weight and its target price was cut to $86 from $91 (versus a $92.56 close, after a 3.9% drop) at Morgan Stanley.

Exxon Mobil Corp. (NYSE: XOM) was downgraded to Sell from Hold and its target price was lowered to $41 from $57 at CFRA. Shares closed down 12.2% at $41.86 on Monday during the oil price collapse.

Garmin Ltd. (NASDAQ: GRMN) was named as the Bull of the Day at Zacks, which said that this electronics firm recently topped analyst estimates for its fourth quarter. Shares most recently closed at $81.16, with a consensus price target of $99.80.

Halliburton Co. (NYSE: HAL) was downgraded to Neutral from Overweight with a $14 target price at JPMorgan.

JPMorgan Chase & Co. (NYSE: JPM) was reiterated as Neutral and the target price was cut to $125 from $140 at Citigroup.

Lincoln National Corp. (NYSE: LNC) was downgraded to Neutral from Overweight at Piper Sandler. Shares fell 16.8% to $31.71 apiece on Monday.

McDonald’s Corp. (NYSE: MCD) was started with an Equal Weight rating with a $210 target price at Stephens.

Microsoft Corp. (NASDAQ: MSFT) was reiterated with an Outperform rating and $210 target price at Wedbush Securities, with the firm noting that its non-PC business with the cloud should grow in the low-to-mid teens in the coming years and stress-testing its model still projects that roughly 90%+ of this revenue is considered to be essential or high priority for enterprises. Microsoft closed down 6.8% at $150.62 on Monday, down from last month’s all-time high of $190.70.

PetroChina Co. Ltd. (NYSE: PTR) was downgraded to Outperform from Buy at Daiwa. The stock was down 8.9% at $34.03, making it among the least battered during the oil price collapse.

Qualcomm Inc. (NASDAQ: QCOM) was started with a Buy rating and a $98 target price (versus a $72.64 close) at Nomura/Instinet.

Ryder System Inc. (NYSE: R) was raised to Buy from Hold at Stifel, but the target price was lowered to $37 from $51 in that call. Shares closed down 10.4% at $30.84, and the prior consensus target price was still up at $54.17.

Schlumberger Ltd. (NYSE: SLB) was downgraded to Sell from Neutral and its target price was slashed to $15 from $42 (versus a $17.31 close) at JPMorgan.

SeaWorld Entertainment Inc. (NYSE: SEAS) was maintained as Buy but its target price was trimmed to $36 from $42 (versus a $16.40 close, after a 21.6% drop) at B. Riley FBR.

Six Flags Entertainment Corp. (NYSE: SIX) was maintained with a Buy rating but its target price was lowered to $28 from $38 (versus a $19.02 close, after a 10.8% drop) at B. Riley FBR.

Splunk Inc. (NASDAQ: SPLK) was named as the Zacks Bear of the Day stock. The firm said that this data analytics company offered disappointing guidance in its most recent earnings report. Shares last closed at $128.24 and have a consensus price target of $167.09.

Stitch Fix Inc. (NASDAQ: SFIX) closed down almost 7% at $21.21 on Monday, with a prior $30 consensus target price. KeyBanc Capital Markets maintained its Overweight rating but lowered its target price to $26 from $34.

Under Armour Inc. (NYSE: UAA) was reiterated as a Sell rating and its target was lowered to $10 from $12 at B. Riley FBR. It closed down 11.5% at $11.17 a share on Monday.

United Parcel Service Inc. (NYSE: UPS) closed down 7.25% at $87.18, with a prior consensus target price. Stifel raised it to Buy from Hold but lowered its target price to $104 from $118.

Wendy’s Co. (NASDAQ: WEN) was started as Overweight with a $29 target price at Stephens. It closed down 2.8% at $18.65 on Monday.

Xylem Inc. (NYSE: XYL) was downgraded to Underperform from Neutral and its target price was cut to $74 from $79 (versus a $75.94 close, after a 6.5% drop) at Credit Suisse.

Many investors are worried that getting the Federal Reserve to cut the federal funds rate and to begin buying Treasuries and other agency paper again will not accomplish very much to protect the economy. After all, the deflationary impact of a “stay at home” economy due to the coronavirus fears, a recession (or what will feel like one) and plummeting oil (gasoline) prices might not be addressed by lower-than-low interest rates. There are six alternative strategies that the Federal Reserve and government can take that might help to stabilize the economy during the coronavirus impact.

Monday’s top analyst upgrades and downgrades included American Express, ADT, Gilead Sciences, Logitech, PACCAR, Regions Financial, Stamps.com, Vivint Smart Home and many more.