5 big analyst picks: Charles Schwab stock called a buy | Pro Recap

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By Davit Kirakosyan

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Charles Schwab upgraded at Credit Suisse

Credit Suisse upgraded Charles Schwab (NYSE:SCHW) to Outperform from Neutral while cutting its price target to $67.50 from $81.50, noting it anticipates continued client sorting, but the risks appear manageable and nearing their peak based on current forward curves.

“Central risk to the upgrade would be a significant shift in forward curve expectations – overly hawkish backdrop will keep alive client sorting while overly dovish landscape will ignite peak of cycle EPS worries and raise rotation risk,” said the firm, adding that other potential risks include high consensus EPS expectations and adverse regulatory changes.

Shares rose more than 4% premarket today following a 9% gain yesterday.

Reinsurance Group of America double upgraded to Buy

Citi upgraded Reinsurance Group of America (NYSE:RGA) to Buy from Sell with a price target of $158.00, noting it is incrementally positive on growth in the US and Asia after sitting with CFO Todd Larson.

The firm’s prior views on earnings volatility and pandemic uncertainty have changed, with natural maturation in the US no longer a subject and an energetic management team.

The firm anticipates continued benefits from cession rates and pricing tailwinds as RGA adjusts for higher mortality experience. They are confident that incoming CEO Tony Cheng's track record of growing the Asian segment, where returns are higher than in the US, will further strengthen RGA's growth trajectory. “On top of this, RGA has no equity market exposure and lower allocations to structured securities vs. the backdrop of macro uncertainty for peers,” added the firm.

3 more upgrades

Citi upgraded Unum Group (NYSE:UNM) to Buy from Neutral and raised its price target to $53.00 from $49.00. Shares were up more than 2% premarket today following an 8% gain yesterday.

The firm strongly recommends the stock due to (1) its Group Benefits business, which has a capital-efficient core and is experiencing remarkable growth due to unique digital offerings, (2) its cash flow profile that is getting better as a result of actions taken to hedge long-term-care (LTC) cash flows and accelerated regulatory reserve additions, and (3) negligible exposure to equity markets and structured securities such as CLOs and CMBS.

JPMorgan upgraded MPLX (NYSE:MPLX) to Overweight from Neutral and raised its price target to $41.00 from $37.00.

“Underpinned by a diverse asset footprint and meaningful refined refinery logistics stability, MPLX continues to demonstrate strong operational performance, including asset and cost optimizations,” said the firm.

Like other companies in the refined pipeline product sector, MPLX is well-placed to take advantage of margin expansions resulting from inflation escalators that lift tariffs more than the realized cost increases, said the firm.

Portland General Electric (NYSE:POR) shares closed nearly 4% higher yesterday after BofA Securities upgraded the company to Buy from Neutral and raised its price target to $52.00 from $42.00.