Stocks have been showing more than just a few concerns over the rise in long-term interest rates. That said, there is a new pro-business regime coming into Washington, D.C. in a week and corporate earnings are expected to be holding up to kick off the new year. Wall Street is still forecasting about 12% upside for the S&P 500 on average into its models for 2025.
Oggonomics reviews many of the daily analyst reports issued from Wall Street. The idea is to look for hidden gems that would either be missed or overlooked for long-term investors and for short-term traders alike. Some of the analyst reports can move stocks.
The analyst calls which are reactionary after earnings or outside news often just mirror the impact and sentiment of what a company has already said in its updates. When analysts get out in front of earnings and key events is when investors are more likely to pay closer attention. After all, the analyst at this point is sticking their neck out and putting their reputation on the line if they are pre-empting news.
Oggonomics is featuring 10 stocks with aggressive analyst calls being made right before corporate earnings are expected to start coming out. These analyst upgrades and/or price target hikes are being made even before many of the companies have issued their 2025/26 outlooks.
These analyst ratings and price targets are all issued by each of the firms named specifically in this report. Oggonomics does not have any in-house price targets and does not have formal ratings on these stocks.
Oggonomics always warns its readers and investors that no single analyst report should ever be the sole basis to buy or sell a stock. That decision to buy or sell, or hold or short sell, is up to each investor and the decision should be made with a financial advisor. And, as a final reminder, there are of course no assurances that any of the price predictions and the scenarios that back the calls up will actually come to fruition — and sometimes analysts are just wrong.
Alphabet Inc.(NASDAQ: GOOGL) is still in the hot seat over how its antitrust ruling will be handed down. It could also be a long process but analysts have been working on a “sum of the parts” thesis in the event of a breakup. Three different price target hikes were seen on Monday. Morgan Stanley reiterated its Overweight rating and raised its target to $215 from $205. Stifel reiterated its Buy rating and raised its target to $225 from $200. Wells Fargo maintained only an Equal-Weight rating, but the firm still hiked its target price to $190 from $187 in the call.
Amazon.com, Inc. (NASDAQ: AMZN) was technically maintained with a rating at two firms but its price target was hiked by both to well above consensus. Amazon was reiterated as Buy and its target price was raised up to $270 from $225 at HSBC. Amazon was reiterated as Overweight and its price target was raised to $280 from $230 at Morgan Stanley. Its prior closing price was $218.94.
American Electric Power (NYSE: AEP) was given a double-upgrade as the electric utility was raised to Buy from Underperform and its price objective was raised to $104 from $98 at BofA Securities. The firm sees 2025 as a promising year for AEP as its transition phase is largely complete. This is after the announced sale of a 19.9% minority stake sale of its transmission holding company assets for $2.8 billion. And from $5.83 EPS for 2025, BofA sees earnings rising to $7.33 EPS by 2028 based on the asset sale and expected equity issuances. AEP closed at $93.51 ahead of the call.
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Chewy, Inc. (NYSE: CHWY) saw two different analyst actions on Monday, January 13. Chewy was raised to Outperform from In-Line and its price target was raised to $47 from $34 by Evercore ISI. Chewy was also reiterated as Overweight and its target was raised to $40 from $38 at Morgan Stanley.
Caterpillar Inc. (NYSE: CAT) lost the equivalent of a Sell rating in an upgrade. Caterpillar was raised to In-Line from Underperform with a $365 price target at Evercore ISI. While the call admits it is hard to be a construction bull with higher interest rates, the expectations of investors have also been greatly reduced while equipment dealers are showing better than expected numbers.
Capital One Financial Corporation (NYSE: COF) is in the process of merging with Discover Financial in an all-stock deal valued at $35.3 billion. The deal still has some risks from some firms but UBS sees both stocks as undervalued ahead of merger synergies. CapitalOne was raised to Buy from Neutral and its price target was raised to $235 from $168 in the call. Discover Financial Services (NYSE: DFS) was also raised to Buy from Neutral and its price target was raised to $239 from $150 at UBS. CapitalOne shares closed at $175.29 ahead of the call, and Discover had closed at $169.64 ahead of the call.
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Crown Castle Inc. (NYSE: CCI) received a solid valuation upgrade from Barclays after a recent interest rate pressure sell-off had overly punished the high-dividend stock. Crown Castle was raised to Overweight from Equal-Weight in the call, but it is worth noting that the subdued share price also saw the firm cut its price target down to $104 from $117. with a likely sale of the fiber business for $8 billion, Barclays sees its shares trading at an attractive entry point as it would be a pure-play U.S. tower company that would generate a 4.8% free cash flow yield. That would then warrant a premium valuation rather than a discount after its story is more concentrated and simplified.
LegalZoom.com, Inc. (NASDAQ: LZ) saw a double-upgrade from JPMorgan, raising the rating to Overweight from Underweight and boosting the price target to $9 from $8. The firm sees a positive inflection point happening in overall business formations in 2025 that should support EBITDA coming in higher than street expectations. It also believes the cost savings from 2024 have not been properly modeled into investor expectations. JPMorgan also slated LegalZoom as a “Positive Catalyst Watch” ahead of its earnings report.
PG&E Corporation (NYSE: PCG) was started as Outperform and it was assigned a $21 target price at BMO Capital Markets. Despite the concerns of the wild fires ensnaring any related companies, PG&E was called a rare deep value opportunity based on its earnings growth and rate base growth being consistent with PG&E’s long-term guidance. The call is also less than a month after the Biden administration handed PG&E a $15 billion low-interest loan. That loan is intended to help PG&E refurbish its hydroelectric infrastructure, upgrade power lines, help fund renewable energy projects, and to provide more support for high-power needs of data centers and electric
vehicles.
