(This is CNBC Pro’s live coverage of Tuesday’s analyst calls and Wall Street chatter. Please refresh every 20-30 minutes to view the latest posts.) A software stock and an e-commerce giant were among the stocks being talked about by analysts on Tuesday. Piper Sandler raised its price target on Atlassian to $225, implying upside of more than 25%. Meanwhile, Mizuho maintained Amazon as a top pick, noting its approaching an inflection point in its artificial intelligence initiatives. Check out the latest calls and chatter below. All times ET. 7:10 a.m.: Citi downgrades Lennar to neutral on the back of a slowing housing market Citi’s taking a step back on shares of Lennar for the time being. Analyst Anthony Pettinari downgraded the home construction stock to neutral from his previous buy rating. Pettinari accompanied the downgrade by lowering his price target to $164 from $174, with the updated forecast reflecting a 12% upside for the stock. Shares of Lennar have slipped 2% this year. Pettinari cited a softening housing market backdrop as one reason for his downgrade. “We see softness in data — permits, starts, sales and prices all recently below expectations — potentially continuing in 2H,” the analyst wrote. “New and existing home inventories are ticking up (despite higher for longer rates) and the ‘twin engines’ of the hot US housing market — TX and FL — are seeing some areas of softening.” Pettinari added that although the Federal Reserve’s upcoming rate cuts could be a potential catalyst into the second half of the year, housing stocks haven’t always rallied into a cutting cycle, historically speaking. “While in our view there is much to like about DHI and LEN (share gain, strong cash flows, resilient GM), we see risk and reward in 2H as roughly balanced, and move to the sidelines,” he wrote. — Lisa Kailai Han 6:54 a.m.: Guggenheim stands by its sell rating on Tesla, despite stock’s 6% Monday rise Guggenheim stood by its sell rating on Tesla , despite Monday’s inbound strength on the electric vehicle manufacturer. Tesla is down 16% on the year but closed 6% higher on Monday. TSLA YTD mountain TSLA year to date Analyst Ronald Jewsikow attributed some of the potential rise to meme stock trader Keith Gill, known by his online moniker “Roaring Kitty.” Gill has been back in the spotlight in recent days after a Securities and Exchange Commission filing showed he’s now the third-largest stakeholder in Chewy. “While difficult to quantify, we have joked that Roaring Kitty might drive an electric vehicle. Electric vehicle stocks have been highly correlated with the so-called meme-stocks on days when there is actionable news related to Roaring Kitty in the market,” the analyst wrote, noting that other electric vehicle stocks also rallied Monday in conjunction. The analyst also attributed Tesla’s Monday rise to “skittishness” around energy storage upside potential. “Recall, CEO Musk highlighted 200-300% energy storage growth at the AGM, a figure we do not believe is possible from a capacity perspective, but could suggest a strong 2Q for GWH deployments,” Jewsikow said. The added that stronger-than-expected deliveries in Europe and China may have also played a role in the stock’s Monday rise. — Lisa Kailai Han 6:33 a.m.: JPMorgan initiates ‘highly profitable’ Waystar at overweight Waystar has a bright outlook ahead, according to JPMorgan. The bank initiated the health care tech stock with an overweight rating and a December 2025 price target of $24. The stock debuted on the Nasdaq last month and closed on Monday afternoon at $21.51. Goldman Sachs’ new price forecast is approximately 12% above Monday’s close. “Waystar is a vertical, cloud-based software company focused on automating, digitizing, and enhancing revenue cycle management functions,” wrote analyst Anne Samuel. “Adoption of their solutions is being driven by the growing number and complexity of healthcare payments and greater utilization of advanced RCM technologies such as AI.” Going forward, the analyst sees “significant room” for Waystar to grow within its $15 billion addressable market opportunity, which is also growing at a 5% annual rate. This total addressable market could increase as Waystar rolls out additional products and solutions. Samuels also highlighted Waystar’s “highly profitable” business model, with margins that could remain stable over time. “Putting it all together, Waystar is a scaled technology-driven business that is very sticky with a highly profitable model, and we view this name as a consistent compounder with a solid financial profile,” the analyst added. — Lisa Kailai Han 6:13 a.m.: Bank of America reiterates buy rating for Spotify, sees 21% upside Good things are due to come for Spotify Technology , according to Bank of America. Analyst Jessica Reif Ehrlich stood by her buy rating for the music platform stock but increased her price objective to $380 from $370. Her updated forecast implies a 21% upside for shares of Spotify. As a catalyst, the analyst cited her optimism for Spotify’s second-quarter results to at least come in to match guidance expectations. Ehrlich also highlighted Spotify’s company initiatives, which include raising its prices, and have put it on the path towards posting positive revenues, gross margins, free cash flows and operating income. “The company clearly is at an inflection point, which has been driving share price performance over the past year and a half,” she wrote. “We are confident in the sustainability of this momentum highlighted by recent price increases that should partially flow through to gross margin.” Meanwhile, the company also has a dedicated consumer base and has demonstrated its ability to grow subscribers. Ehrlich sees further upside from potential pricing tiers and features such as audiobooks. Shares of Spotify have soared 67% in 2024. — Lisa Kailai Han 5:55 a.m.: Wells Fargo reiterates overweight rating on Las Vegas Sands but lowers price target Wells Fargo is still bullish on Las Vegas Sands long term, although it sees some near-term blips on the radar. Analyst Daniel Politzer reiterated his overweight rating on the casino and resort stock but lowered his price target to $58 from $60. This new forecast corresponds to a potential 35% upside for shares of Las Vegas Sands. The stock has slipped 13% in 2024. Politzer wrote that he was lowering his price to reflect updated gross gaming revenues, or GGR, and potential share shifts. While GGR has been solid for the last few months, overall growth decelerated over the course of last month. “Our LVS/WYNN est’s both reflect our expectation for modest sequential market share losses, w/ LVS affected by Londoner construction disruption,” the analyst said. However, Politzer believes that the setup for Las Vegas Sands could improve into the end of this year and 2025 once its estimates improve. “We are Overweight, but acknowledge LVS may be more suited for investors w/ duration/appreciation for capital return than those seeking NT upside from Macau GGR re-accelerating,” the analyst added. Politzer specifically highlighted the company’s Marina Bay Sands resort in Singapore as a “bright spot” in its portfolio. — Lisa Kailai Han 5:43 a.m.: Piper Sandler upgrades Atlassian to overweight after 25% sell-off Investors could be overlooking Atlassian at the moment, according to Piper Sandler. The investment firm upgraded the software stock to overweight from neutral. Analyst Rob Owens also increased his price target to $225 from $200. This updated forecast implies that shares of Atlassian could jump 26% from here. Shares of Atlassian have plunged 25% this year, making the risk/reward look more favorable. The analyst wrote that he sees “the current valuation as an attractive entry point into what we view as one of the most durable companies in our coverage.” As more consumers migrate to the cloud, Owens believes that this could drive further durable growth for the company. “We do believe that it is a question of when — not if — these enterprises will move to cloud. With a large amount of new data residency locations coming online in the last year, compelling new products in the cloud only like Atlassian Intelligence and more improvements on the way, we believe enterprise migrations will pick up steam going forward,” he wrote. Meanwhile, Atlassian’s product innovations could create cross-sell opportunities for the company. — Lisa Kailai Han 5:43 a.m.: Amazon reaching AI ‘inflection point,’ says Mizuho Mizuho thinks Amazon could soon get a major boost from artificial intelligence. The bank maintained the e-commerce giant as a top pick. Its $240 price target on the stock implies upside of 21.7% from Monday’s close. “Gen-AI projects are nearing an inflection point, with external-facing models 6 months away from commercial deployments,” analyst James Lee wrote. “After launch, we expect the consumption multiplier effect to kick in as inferencing activity should accelerate meaningfully given the large base of external customers.” “With that in mind, we have increased conviction of AWS acceleration and our above-the-Street revenue growth forecast of 20%,” Lee added. Amazon shares have popped nearly 30% year to date. AMZN YTD mountain AMZN year to date — Fred Imbert
Tuesday’s analyst calls: Amazon near AI ‘inflection point’, software stock to pop more than 25%
Jul 2, 2024
