Check out today's top analyst calls from around Wall Street, compiled by The Fly.
MORGAN STANLEY DEFENDS APPLE: Morgan Stanley analyst Katy Huberty called the 8.5% decline in Apple (AAPL) shares following Lumentum's (LITE) and Qorvo's (QRVO) negative pre-announcements this week a buying opportunity, noting that she is still bullish on the iPhone maker's Services growth. Services will "take the growth baton" from Devices as the smartphone market matures, contends Huberty. While she believes investors should focus on Services rather than iPhone units, Huberty also believes Apple's December quarter guidance incorporates the revisions made by Lumentum and Qorvo, adding that unit revisions are typically more severe for the supply chain than Apple. Huberty kept an Overweight rating and $253 price target on Apple shares, which are up just over 1% in late morning trading.
ARGUS UPGRADES MYLAN TO BUY: Argus analyst Jasper Hellweg upgraded Mylan (MYL) to Buy from Hold with a price target of $42, saying the stock appears to be close to an inflection after several quarters of underperformance. The analyst pointed to the company's Q3 earnings beat and its gross margin expansion of 280bps. Hellweg further cited Mylan's launch of a "record number of new generic and biosimilar products this year, significantly diversifying its portfolio" whereby no single product now accounts for more than 3% of revenue. Mylan shares are up more than 1.7% in late morning trading.
JPMORGAN UPGRADES ATHENEX TO OVERWEIGHT: JPMorgan analyst Leon Chik upgraded Athenex (ATNX) to Overweight from Neutral while lowering his price target for the shares to $15 from $24. More clinical data and progress in new drug trials should boost investor sentiment in 2019, Chik wrote in a research note. The analyst pointed out that the shares have underperformed the Nasdaq composite by 40% since June as investors await Phase 3 clinical data on Oraxol, which he expects to be released by mid-2019. In late morning trading, shares of Athenex are trading higher by 5.8%.
MORGAN STANLEY CUTS PG&E TO EQUAL WEIGHT ON FIRE UNCERTAINTY: Morgan Stanley analyst Stephen Byrd downgraded PG&E (PCG) to Equal Weight from Overweight as he sees an "unprecedented" level of uncertainty given that there is currently no liability cap that would be applied to 2018 wildfires. He noted that changes to the criteria for CPUC evaluation do not go into effect until 2019 and that there is no clear path to new legislation in the near-term. Byrd also pointed out that a recently-passed bill included language that requires the CPUC to consider the utility's financial status when assigning costs to shareholders for wildfires, but investors worry that the cap may not cover the damages from the Camp Fire. While he thinks it would apply, Byrd said clarity on this cap may not come until 6-9 months from now. The analyst, who also cited the potential for additional fires this year, lowered his price target on PG&E shares to $31 from $67. Shares of PG&E have plummeted 23.3% in late morning trading.
MIZUHO CUTS HORIZON TO NEUTRAL: Mizuho analyst Irina Koffler downgraded Horizon Pharma (HZNP) to Neutral from Buy and lowered her price target for the shares to $21 from $25. After speaking with management about planned investments in teprotumumab pre-launch and the Mirror trial, the analyst reduced her 2019 forecasts for Krystexxa and Actimmune to below consensus. Apart from the "well-telegraphed Krystexxa cliff" in Q1 of 2019, limited Iqvia demand visibility during the first half of next year and already bullish expectations for strong Phase III teprotumumab readout in Q2 warrant increased caution in Horizon shares, Koffler said. She believes consensus estimates for 2019 are too high and views the stock as fairly valued at $21.
BARCLAYS INITIATES U.S. PAYMENT PROCESSORS, CALLS PAYPAL TOP PICK: Barclays analyst Ramsey El-Assal initiated a group of 20 U.S. companies in the Payments, Processing, and related IT Services sector with Overweight-rated PayPal (PYPL) as his Top Pick. The analyst cites the company's "100% exposure to high-growth digital channels" along with its "clean balance sheet substantial cash position" that bring it a "strategic opportunity." El-Assal is also particularly positive on Overweight-rated WorldPay (WP) based on its strong growth potential from its exposure to "tech-enabled channels" and merger synergies, FirstData (FDC) based on the accelerating growth of its merchant channels, and Square (SQ)," whose Subscription & Services segment is blurring the lines between Payments and software".
Symbol now VTRS
+0.46 (+1.34%)
Qorvo
+0.77 (+1.22%)
Lumentum
+0.29 (+0.75%)
Apple
+1.56 (+0.84%)
Athenex
+0.52 (+5.06%)
PG&E
-6.12 (-23.85%)
Horizon Therapeutics
-0.7 (-3.30%)
PayPal
+0.24 (+0.29%)
Worldpay
-0.71 (-0.86%)
First Data
+0.17 (+0.95%)
Block
+0.9 (+1.29%)