Here is your Pro Recap of the biggest analyst picks and cuts you may have missed since Friday: upgrades at Amazon, Monster Beverage, and downgrades at Apple, Cloudflare, and General Motors.
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Rosenblatt downgrades Apple following mixed Q3
Rosenblatt downgraded Apple (NASDAQ:AAPL) to Neutral from Buy with a price target of $198.00, following the company’s mixed Q3 results, highlighted by EPS/revenue beat but weaker iPhone sales. As a result, shares fell more than 4% on Friday.
The firm noted that Apple's recent quarterly performance indicates a slowing phase.
Apple makes the most important device of the modern economy - the iPhone - has executed an impressive upgrade to Macs with the pivot to Apple Silicon, and is re-accelerating services. But a slowdown in the U.S. seems likely to last until a material new product category takes hold.
The uncertainty regarding when this new product will arrive and its potential success makes the stock less appealing, given it is now trading at near-peak absolute and relative multiples.
Amazon gets upgraded at two firms following a Q2 beat
Amazon.com (NASDAQ:AMZN) earned two upgrades following better-than-expected Q2 results and strong guidance, which drove the share more than 8% on Friday.
Exane BNP Paribas upgraded the company to Neutral from Underperform with a price target of $140.00.
Meanwhile, Rosenblatt upgraded to Buy from Neutral and raised its price target to $184.00 from $111.00.
Rosenblatt analyst said their previous worries about overly positive Street expectations have abated. With the company shifting its focus toward efficiency in retail and AI becoming a key factor in cloud services, the potential economic challenges seem less concerning to the firm, opening up opportunities for higher-multiple consumer growth stories.
Guggenheim downgrades Cloudflare after Q2 beat
Cloudflare (NYSE:NET) shares fell more than 2% premarket today after Guggenheim downgraded the company to Sell from Neutral with a price target of $50.00, as reported in real time on InvestingPro.
Cloud should have always been, we believe there is certainly execution risk associated with the attainment of this, and again believe the stock has gotten way ahead of itself.
Despite a slight improvement in Q2/23 earnings, which resulted in a share price surge of more than 6% on Friday, Guggenheim doesn't expect this trend to continue into the latter half of the year. According to the firm, meeting the expectations, as guided, will be challenging unless the overall economic environment, which the company's management described as a "grind", sees significant improvement.
2 more analyst rating moves
CFRA downgraded General Motors (NYSE:GM) to Strong Sell from Hold and cut its price target to $28.00 from $40.00.
We move to Strong Sell on the growing risk of a UAW strike, given reports that the company and union remain extremely far apart in labor negotiations ahead of the September 14 expiration of the current UAW contract.
Piper Sandler upgraded Monster Beverage (NASDAQ:MNST) to Overweight from Neutral with a price target of $63.00 (from $60.00), expecting the company to continue to be well-positioned. As a result, shares gained more than 2% premarket today.
Its 2Q23 results were below expectations, but there is nothing concerning about the business or its near and longterm momentum.
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