(This is CNBC Pro’s live coverage of Monday’s analyst calls and Wall Street chatter. Please refresh every 20-30 minutes to view the latest posts.) A major chipmaker and a banking giant were among the stocks being talked about by analysts on Monday. UBS raised its price target on Nvidia , calling for nearly 20% upside. Meanwhile, Wolfe Research downgraded JPMorgan Chase to peer perform from outperform. Check out the latest calls and chatter below. All times ET. 8:24 a.m.: TD Cowen upgrades Fortive to buy TD Cowen upgraded industrial conglomerate Fortive to buy from hold, and raised its price target, saying a focused approach to future capital deployment raises confidence in the stock. “Our recent time with management supports a more constructive stance with incremental comfort around capital deployment strategy, which has been our most significant hang-up historically,” analyst Joe Giordano wrote on Monday. “Benchmarked vs. compounder peers, FTV’s financial performance and profile are attractive, and if investors gain confidence in deployment, we’d expect valuation to rerate higher towards the group from cycle lows.” In the past, the company’s unclear strategy for mergers and acquisitions was a sticking point for the analyst, who noted Fortive’s previous pivots to varied businesses in software, health care and hardware. Now, however, the analyst is confident investors can be comfortable with the company’s future acquisitions. “The path to get the portfolio to the current state has been a bit circuitous, but we think the company has arrived at a place where future M & A will be closer to core, and therefore more predictable and palatable for investors,” Giordano wrote. Fortive shares are higher by more than 16% this year. The analyst’s $90 price target, raised from $75, implies more than 20% upside. The stock popped 2% in Monday premarket trading. — Sarah Min 8:22 a.m.: Raymond James upgrades Gilead to outperform The drug pipeline for Gilead Sciences suggests the company is poised for multi-year growth, according to Raymond James. Analyst Steven Seedhouse upgraded the biotech stock to outperform from market perform, saying in a note to clients that potential new drugs for HIV prevention and a liver disease look like big sucessess. “Collectively, lenacapavir PrEP and seladelpar could contribute multi-billion dollar top-line growth over the next five years ($3.7B combined annual sales by 2030 in our model),” the note said. Liver drug seladelpar was part of Gilead’s acquisition of CymaBay Therapeutics. That deal was closed in March, and the drug is expected to approved later this year, according to Raymond James. The investment firm set a price target of $93 per share for Gilead, which is nearly 40% above where the stock closed Friday. — Jesse Pound 7:36 a.m.: KBW upgrades Charles Schwab Charles Schwab is approaching an inflection point that should see its earnings power and stock price increase in the coming years, according to investment firm KBW. Analyst Kyle Voigt upgraded the brokerage stock to outperform from market perform, saying in a note to clients that Schwab could average 15% earnings per share growth per year in the back half of the decade as the interest rate environment normalizes. “This EPS growth rate is helped by material levels of capital return, partially enabled by pushing some deposit growth off balance sheet over this timeframe. With greater confidence in a path forward from here, and with the Fed looking increasingly likely to cut rates in the coming months, our upgrade comes ahead of an expected sweep cash inflection,” the note said. Schwab was one of the financial firms that was hit by customers taking advantage of higher interest rates by shifting their money to accounts with more yield, a process known as cash sorting. However, that appears to have settled down now, KBW said. “Investors are no longer particularly concerned with SCHW’s current balance sheet funding, as the company has now made incremental progress on repayment of supplemental borrowings and cash sorting has decelerated materially,” the note said. Voigt hiked the price target on the stock to $84 per share from $76. The new target is more than 17% above where shares closed Friday. — Jesse Pound 7:15 a.m.: Baird upgrades shares of Domino’s Pizza Investors can look towards Domino’s Pizza as a solid long-term buy, according to Baird. The investment firm upgraded the pizza chain stock to an outperform rating. Analyst David Tarantino simultaneously raised his price target to $580 from $530, with this new forecast approximately 17% higher from where shares closed last Friday. Domino’s Pizza stock has added nearly 20% in 2024, although the analyst cited a recent share pullback as a catalyst. “With shares down 7.5% (S & P 500 +1.5%) from the June peak and with our confidence level in the fundamental outlook having risen, we now see a more appealing risk/reward on DPZ,” he wrote. Tarantino added that the company’s strong fundamentals have meaningfully increased investor confidence and conviction. As evidence of these rising fundamentals, the analyst pointed to the pizza chain’s advertising approach, product pipeline, operations, rising penetration and improved relative value proposition. Additionally, Domino’s stock looks like a solid investment over the long term, Tarantino said. “With visible sales drivers, a positive unit development outlook, and a highly-franchised business model, DPZ has a profile that fits well with the type of businesses that we think are attractive to own amid ongoing uncertainties about the health of consumer spending,” he added. — Lisa Kailai Han 7:12 a.m.: Bank of America upgrades SolarEdge, cites attractive current valuation Bank of America is growing more bullish on SolarEdge Technologies , but not ready to move completely off the sidelines just yet. Analyst Dimple Gosai upgraded shares of the energy company to a neutral rating from underperform. Gosai simultaneously hiked her price target to $44 from $29, implying that shares of SolarEdge could rally 76% from Friday’s close. SolarEdge stock has plunged an eye-watering 73% this year, which Gosai believes has set the stock at an attractive entry point. “SEDG shares are trading near YTD lows post 2Q guidance miss, underperforming ENPH and solar peers (TAN Index) by ~50% YTD,” the analyst wrote. “We think the recent stock price pullback is pricing in an unlikely worst-case scenario of inventory writedowns, a lack of recovery in the inventory channel congestion through ’25 and an inability to monetize the balance sheet.” However, Gosai added that while valuations look attractive at their current levels, she is still waiting for a “more tangible path for margin and cash flow recovery.” “We continue to like SEDG’s diversified exposure, but channel health dampens the near-term outlook; against this backdrop, shares appear more fairly valued,” the analyst added. — Lisa Kailai Han 7:10 a.m.: Wells Fargo raises Roblox price target Roblox is due for a rebound, according to Wells Fargo. Analyst Ken Gawrelski stood by his overweight rating but raised his price target for the gaming platform to $43 from $41. This updated forecast implies the stock could rally 11% from Friday’s close. Shares of Roblox are down 15% on the year. “Encouraged by traffic data showing cont’d recovery in engagement post April and raising 2Q bookings to high end of the guide,” wrote the analyst. “View 3Q guide strength as critical to retaining investor confidence in RBLX core fundamentals.” Meanwhile, the analyst added that he expects Roblox to provide updates on its recent ad initiatives, with recent commerce testing providing “groundwork” for future direct response advertising. — Lisa Kailai Han 6:25 a.m.: Guggenheim downgrades ServiceNow to sell Shares of ServiceNow are due to slip, according to Guggenheim. Analyst John DiFucci downgraded the cloud computing stock to a sell rating from neutral. He also set a price target of $640, which implies downside of 21%. “While we believe 2Q24 will be fine when NOW reports on 7/24, we believe 2H24 presents risk to consensus Subscription, presenting material risk in the stock, currently trading at a rich 15x EV/NTM likely recurring revenue,” the analyst wrote. “NOW seems to be expecting an uptick in GenAI business in the 2H, but our field work indicates this is not likely until 2025, if ever.” DiFucci added that several of ServiceNow’s partners have expressed their concern about the company’s generative artificial intelligence monetization not happening en masse this year. The analyst also said that he believes ServiceNow will have a “material risk” to lower its top-line subscription guidance for 2024. Shares of ServiceNow have risen 14% on the year. NOW YTD mountain NOW year to date — Lisa Kailai Han 6:10 a.m.: UBS upgrades PNC to buy There’s a bright future ahead for PNC Financial Services , according to UBS. UBS analyst Erika Najarian upgraded the regional bank to buy from neutral. She also increased her price target to $179 from $165. This new forecast implies shares could rise 14% from Friday’s close. PNC stock is just 1% higher on the year, but Najarian thinks growth opportunities could propel shares higher, alongside the firm’s strong capital levels. “As we await the long anticipated return to broader loan growth in 2H24, we think PNC appears better positioned than most to benefit from an improvement in demand,” she wrote. “After capital requirements were unchanged coming out of this year’s DFAST cycle, PNC has sufficient excess capital above minimum requirements, strong organic capital generation, and significant run off of securities related AOCI marks over the next 18 months.” The analyst added that PNC’s market gains in expansion markets should give it a leg above its peers to grow loans both this year and next. — Lisa Kailai Han 5:50 a.m.: UBS hikes Nvidia price target, now sees 19% upside UBS sees more gains ahead for Nvidia . Analyst Timothy Arcuri raised his price target for the graphics processing unit manufacturer to $150 from $120. reiterating his buy rating. This updated target is 19% above Friday’s close. Arcuri pointed to strong demand for Nvidia’s latest microarchitecture as one reason for the price target raise. “Our recent supply chain checks confirm our prior suspicions that demand momentum for Blackwell rack-scale systems remains exceedingly robust,” the analyst wrote. “This comes as sentiment on the stock — though still strong — has faded somewhat in recent weeks, creating more of a ‘wall of worry’ that should be ultimately healthy if our outlook materializes.” Shares of Nvidia have rallied 154% this year to record levels amid optimism around artificial intelligence. — Lisa Kailai Han 5:50 a.m.: Wolfe Research downgrades JPMorgan Chase JPMorgan Chase’s valuation is becoming stretched, and it’s time for investors to step away from the banking giant, according to Wolfe Research. Analyst Steven Chubak downgraded the stock to peer perform from outperform. He also removed his price target of $216, which implied upside of 5%. “We continue to believe that JPM is one of the best run financial institutions, but with valuation approaching all-time highs (on a relative [price-to-earnings] and [price-to-tangible book value] basis), and the firm more exposed to net interest income headwinds from lower rates, we are taking some chips off the table,” Chubak wrote. JPMorgan Chase shares have outperformed this year, rising more than 20%, while the SPDR S & P Bank ETF (KBE) has lost 1% in that time. JPM KBE YTD mountain JPM vs KBE year to date “While JPM should be a flight-to-quality beneficiary in a tougher macro environment, with lofty valuation, a less robust go forward EPS growth profile … we are comfortable taking profits,” the analyst added. The downgrade comes ahead of JPMorgan Chase releasing its second-quarter results on Friday. — Fred Imbert
Monday’s analyst calls: Nvidia gets a price target increase, JPMorgan Chase is downgraded
Jul 8, 2024
