Deutsche Bank Upgrades Snap to Buy, Predicts 16% Gains
Deutsche Bank has raised its rating on social media stock Snap to buy from hold, forecasting more than a 16% increase in the stock’s value. The bank cited several catalysts for the upgrade, including the success of Snapchat+, the performance of the ad platform rebuild, a potential partnership with Amazon, and increased inbound advertising from China. Deutsche Bank also mentioned positive industry checks that indicate the completion of the ad-platform rebuild and improved return on ad spend for advertisers. Snap had a strong year in 2023, with its stock rising by 89%.
Oppenheimer Upgrades Coinbase to Outperform
Investment bank Oppenheimer has upgraded cryptocurrency exchange Coinbase to outperform from perform and set a price target of $160 per share. This implies a potential upside of over 32% from Thursday’s closing price. The bank believes that Coinbase is stronger than many people realize and highlighted positive catalysts such as the potential approval of spot bitcoin exchange traded funds and the outcome of Coinbase’s litigation with the U.S. Securities and Exchange Commission. Despite a challenging start to 2024, with a 30% decline in its stock, Oppenheimer sees an attractive risk-to-reward skew for investors.
JPMorgan Downgrades Dow Inc After Q4 Earnings
JPMorgan has downgraded Dow Inc to neutral from overweight following the company’s fourth-quarter earnings report. The bank noted that Dow’s specialty plastics division performed well in Q4 but its other two segments, industrial intermediates and performance materials, contributed much less to earnings. JPMorgan also highlighted constraints on Dow’s cash flow due to rising capital expenditures related to a large integrated Alberta PE project. The bank believes that there is limited room for share repurchases or dividend increases without leveraging the balance sheet. Dow’s stock closed at $54.94 on Thursday, close to JPMorgan’s price target of $55.
TD Cowen Upgrades American Airlines, Expects 30% Gain
Analyst Helane Becker from TD Cowen has upgraded American Airlines to outperform from market perform, projecting a potential climb of more than 30% in the stock’s value. Becker cited a strong fourth quarter for the airline and stated that better-than-expected guidance for 2024 looks achievable. The upgrade follows American Airlines beating estimates on both the top and bottom lines in Q4, leading to a 10% jump in its stock. Seaport Research Partners also upgraded American to buy from neutral.
UBS Downgrades Archer-Daniels-Midland to Neutral
UBS has downgraded nutrition company Archer-Daniels-Midland to neutral from buy due to diminishing margins on soy crush and ethanol. The bank highlighted factors such as no growth in the company’s nutrition segment, a decline in soy crush earnings year over year, weaker refined soybean oil premium, and weaker ethanol margins affecting carbohydrate solutions earnings. Despite slashing its price target by half, UBS expects strong buybacks from Archer-Daniels-Midland based on estimated post-dividend free cash flow for 2024 and 2025.
Bank of America Reiterates Buy Rating on Dow Inc
Bank of America has reiterated its buy rating on chemicals company Dow Inc, emphasizing signs of an earnings recovery. The bank mentioned that although Dow missed expectations for Q4 EBITDA and first-quarter guidance, management sounded more positive compared to previous calls. Bank of America also noted that trade disruptions in the Red Sea could benefit Dow, particularly its European operations, due to reduced imports and increased demand for export polyethylene in the US. Bank of America’s buy rating implies further upside for Dow.
Wells Fargo Maintains JPMorgan Chase as Signature Pick
Wells Fargo is standing by banking giant JPMorgan Chase after the company’s reorganization. The firm reiterated its overweight rating on JPMorgan Chase stock and a $200 per share price target. Wells Fargo believes that recent moves to expand roles for top executives position the company well for the future. The firm highlighted JPMorgan’s ability to cross-pollinate skills and multiple career paths for employees as strengths. Wells Fargo’s forecast suggests nearly 16% upside for JPMorgan Chase moving forward.
Wells Fargo Names Popular a Top Pick
Following a fourth-quarter earnings beat, Wells Fargo has named Puerto Rican bank operator Popular a top pick for 2024. The firm reiterated its overweight rating on the stock and set a price target of $105 per share, implying over 22% upside potential. Wells Fargo sees Popular as a significant beneficiary of structural tailwinds benefiting the Puerto Rican economy since it is the largest player on the island. Popular stock has already risen approximately 5% since the start of the year.
UBS Downgrades Humana, Citing Lack of Clarity
UBS has downgraded health insurance company Humana from buy to neutral due to volatile near-term results and an extended timetable to recover margins. The bank lowered its price target to $370 per share from $530, suggesting about a 2% downside potential. UBS believes that given recent outlook adjustments, it may take time for the market to regain confidence in Humana’s near-term forecasts. However, UBS also noted that Humana’s 2024 outlook includes several negative assumptions and expressed optimism about the company’s long-term prospects.
Piper Sandler Downgrades U.S. Bancorp
Piper Sandler has downgraded regional bank U.S. Bancorp from overweight to neutral, citing a less unique position compared to its peers. The firm lowered its price target to $46 per share from $47,
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