U.S. stocks were higher on Friday as the markets are challenging all-time highs ahead of earnings and after a downtick in the inflation readings. While some investors have decided to rotate out of some of 2024’s biggest gains, investors are looking for stocks that are likely to exceed expectations in earnings season. Just keep in mind that earnings expectations are likely to be high after strong gains in 2024.
Oggonomics is featuring the analyst calls that are targeting earnings and the second half of 2024. Some of the analyst upgrades, downgrades and initiations are viewing shorter time horizons than the usual 12-month outlook. Other calls will maintain a long-term outlook rather than just a short-term view.
These were some of the biggest analyst calls impacting stocks on Friday, January 12, 2024.
Booking Holdings, Inc. (NASDAQ: BKNG) was raised to Buy from Hold at Benchmark and the online travel giant was assigned a $4,700 price target. The firm noted that the timing may be when there are economic worries but with emerging market penetration it should be able to outperform expectations for the next 18 months or more. Booking shares were trading up over 1% at $4,001.00 on Friday after the call. And yes, Booking is one the big stocks needing a serious stock split.
Carvana Co. (NYSE: CVNA) was initiated with a Buy rating and was assigned a $155 price target at BTIG. While Carvana trades at a premium to most e-commerce and auto-stocks it vertical integration and in-sourcing model give it a much larger total addressable market. Carvana shares were trading up almost 4% at $134.00 in Friday’s trading.
Domino’s Pizza, Inc. (NYSE: DPZ) is a classic “buy the pullback” call after its stock sold off more than 10% since June and ahead of earnings. Oppenheimer reiterated its Outperform rating and its $580 price target (versus $473.09 prior close). Oppenheimer sees a path for “robust traffic and positive earnings revisions” while the restaurant and food-to-go categories when the entire sector is suffering from problems in prices and values, as well as negative traffic and weak earnings. The firm even called it a top pick heading into earnings season. Domino’s has a 52-week range of $330.05 to $542.75.
ESS Tech, Inc. (NYSE: GWH) manufactures long-duration energy storage systems for commercial and utility-scale outfits. Roth MKM started ESS with a new Buy rating and assigned a $1.50 price target ahead of its energy storage solution this year as drivers to expand its addressable market and to drive volume growth and sales acceleration. Please note that ESS Tech has a tiny market cap of $153 million and share price of less than $1.00. That’s a double-whammy that makes ESS Tech far more risky than larger stocks that are usually the focus of most analyst reports.
J.Jill, Inc. (NYSE: JILL) may not be the most common name in apparel investing, but its shares are up 10% this week (last seen up 2% at $37.35) after two upgrades. Jefferies issued a new Buy rating and a $44 price target on Friday, after BTIG also issued a new Buy rating and the same $4 price target on Wednesday. These calls are after a $31 million equity sale in June that was raised primarily to pay down debt. J.Jill has a market cap of only $440 million and its shares have a 52-week range of $18.85 to $40.61.
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Joby Aviation Inc.(NYSE: JOBY) is more than speculative but after news of its hydrogen-powered test-flight of 523 miles Cantor Fitzgerald issued a very bullish note with its Overweight rating and its $10 price target. Joby’s stock was up 3% at $6.40 on Friday and its 52-week range is $4.50 to $10.68.
Marathon Oil Corporation (NYSE: MRO) just lost a believer in its merger chances with ConocoPhillips on the heels of the FTC requesting additional information on its $22.5 billion merger. Scotiabank downgraded Marathon to Sector Perform from Outperform and the firm slashed its price target down to $29 from $45 in the call. Marathon shares were down about 0.5% at $28.50 and its 52-week range is $21.81 to $30.06.
Microsoft Corporation (NASDAQ: MSFT) was reiterated as Outperform, was maintained as a “Top Pick” and its price target was raised to $500 from $465 at BMO Capital Markets. The firm was bullish on cloud demand and even sees upside to Azure growth expectations ahead of earnings as a continued durable growth story.
Netflix, Inc. (NASDAQ: NFLX) received yet another price target hike a week ahead of earnings. JPMorgan reiterated its Overweight rating and raised its price target to $750 from $650. The pre-earnings call noted that estimates on subscribers, revenue growth, cash flow and margins could all be even better than expected. Its stock was up less than 1% at $654.00 on the heels of this call.
Six Flags Entertainment Corporation (NYSE: FUN) has now completed its $8 billion merger with Cedar Fair. Stifel assumed coverage with a new Buy rating and its old $53 price target was price target was reassigned at $68 after the merger. Stifel sees upside to the legacy theme parks and believes attendance growth will return after pricing measures are factored in over time. Six Flags’ stock was up almost 2% at $53.00 and the 52-week range is $34.04 to $58.70.
Tesla, Inc. (NASDAQ: TSLA) was downgraded to Sell from Neutral at UBS over concerns that AI-investments may not pay off for the stock, but the firm actually raised its price target all the way up to $197 from $147. Mizuho maintained its Neutral rating but also raised its price target to $230 from $180 in that call.
Thursday’s pre-earnings analyst calls were in Apple, Broadcom, Costco, Spotify, Taiwan Semi and others.
