By Davit Kirakosyan
Here is your Pro Recap of the biggest analyst cut you may have missed since yesterday: downgrades for Home Depot, WeWork , On Holding , and Inter.
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Home Depot downgraded on near-term headwinds
CFRA downgraded Home Depot (NYSE:HD) to Hold from Buy and cut its price target to $306.00 from $340.00, as InvestingPro reported in real-time.
According to the firm, its positive long-term view on Home Depot shares is tempered by near-term headwinds, including product pricing normalization, digestion of top-line growth, and a forecasted remodeling decline in 2024.
Shares fell more than 2% yesterday on a Q1 miss and lower full-year guidance.
WeWork downgraded following CEO transition announcement
Mizuho Securities downgraded WeWork (NYSE:WE) to Neutral from Buy and cut its price target to $0.30 from $1.75 following the company’s announcement, according to which Sandeep Mathrani will be stepping down as Chairman, CEO, and director of the company, effective May 26. Shares gained following the announcement, currently trading more than 8% higher in pre-market.
According to Mizuho, the CEO change is disruptive, especially given the current macro challenges. These challenges have worsened in the past two months with more layoffs and bankruptcies. The firm now sees its base case business assumptions, specifically occupancy targets, as unachievable, leading to higher cash burn and eventually driving the need for outside capital. The firm doesn't expect positive free cash flow until the end of 2025.
2 more downgrades
Williams Capital downgraded On Holding (NYSE:ONON) to Sell from Hold and cut its price target to $26.00 from $29.00.
Shares dropped more than 9% yesterday despite a Q1 earnings beat.
Bradesco BBI downgraded Inter (NASDAQ:INTR) to Underperform from Outperform with a price target of $2.50, incorporating last week’s Q1 results and slashing its earnings estimates for the coming years, as the company has been struggling to deliver higher levels of profitability, in spite of the recent initiatives to do so.
Shares fell more than 3% yesterday.
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