Analyst Calls: Tesla Down, Microsoft Up, Tech in Focus

Key Takeaway

• Barclays lowers Tesla's price target to $180, anticipating a Q1 earnings miss amid concerns over gross margins and cash flow.
• Analysts show varied optimism across sectors, with upgrades for Royal Caribbean and Hancock Whitney, but a downgrade for Urban Outfitters.
• Tech sector sees significant activity; Microsoft's price target raised to $480 by Wells Fargo with AI as a key driver, while Apple maintains hold status at Loop due to China issues.

Analyst Insights on Tesla

Barclays has adjusted its stance on Tesla, reducing the price target from $225 to $180 per share. The firm anticipates a negative catalyst for Tesla as it approaches its earnings announcement, highlighting a pivotal moment for the electric vehicle maker amidst a "sea of uncertainty." Analyst Dan Levy from Barclays forecasts a potential miss on first-quarter earnings expectations, with concerns over gross margins and possibly negative free cash flow, a scenario last observed in the first quarter of 2020. Levy suggests Tesla may shift focus from mass production of Model 2 towards robotaxi and full self-driving subscriptions, indicating a significant pivot in investment thesis.

Diverse Ratings Across Sectors

Wall Street analysts have issued various ratings and price targets for a range of companies, indicating differing levels of optimism and concern. Mizuho has initiated Royal Caribbean with a buy rating, citing its unique mix of quality ship assets and destinations. Citi has upgraded Hancock Whitney to buy from neutral, pointing to an undervaluation in the regional bank space. Raymond James has initiated GE Vernova as outperform, appreciating its involvement across a broad spectrum of conventional and renewable generation. HSBC upgrades Danaher to buy from hold, seeing potential in biotech funding recovery. Conversely, Jefferies downgrades Urban Outfitters to underperform from buy, citing concerns over slowing foot traffic and increased competition.

Tech and Media Companies in Focus

The technology and media sectors have seen a flurry of activity, with analysts issuing various upgrades, downgrades, and initiations. Wells Fargo reiterates Microsoft as overweight, raising its price target to $480 from $460, and highlighting AI as a significant catalyst. Loop maintains Apple as hold, noting ongoing issues in China and aggressive discounting strategies. Maxim initiates coverage on Apple and Amazon with buy ratings, applying forward P/E multiples to forecasted earnings. Wells Fargo upgrades Omnicom to overweight from equal weight, suggesting potential for re-rating based on agency data points becoming themes.

Street Views

• Barclays on Tesla (Neutral):

  "Facing an investment thesis pivot and a sea of uncertainty, this Tesla call is extra highly anticipated; expect negative catalyst."

• Mizuho on Royal Caribbean (Bullish):

  "RCL has a unique mix of quality ship assets, as well as differentiated destinations, the combination of which drives upside potential to estimates."

• Citi on Hancock Whitney (Bullish):

  "With the market unfairly pricing in a dour credit outlook across the regional bank space, we are stepping off the sidelines and upgrading HWC to Buy."

• Raymond James on GE Vernova (Bullish):

  "Combining strengths across a broad spectrum of conventional and renewable generation, as well as grid technology, Vernova is involved in practically everything. Diversification has both advantages and drawbacks."

• HSBC on Danaher (Bullish):

  "We upgrade Danaher to Buy from Hold as a quality proxy for the Biotech funding recovery."

• Wells Fargo on Omnicom (Bullish):

  "We also think OMC can rerate as, in our experience, Agency data points become themes and those themes impact the multiples."

• Loop on Apple (Neutral):

  "Issues remain in China and globally frankly. In China, AAPL has been heavily discounting iPhones, and we are seeing a similar aggressive discount program in several other Asian locales."

• Wells Fargo on Microsoft (Bullish):

  "Also continue to see MSFT as the best way to play AI, another 2H catalyst."

• TD Cowen on Elf Beauty (Bullish): > "ELF could double revenues over the next 3 years yielding low-to-mid 20s annual growth rate through digital community marketing leadership awareness flywheel skincare & international expansion"

• Jefferies downgrades Urban Outfitters(Bearish) :> "We have some concern regarding URBN’s near-term positioning due to slowing foot traffic data promotional headwinds increased competition"

• Barclays reiterates Broadcom(bullsih) :> "Ultimately we come away with valuable second opinion future AI greater appreciation company's many ways win"

• Morgan Stanley reiterates Nvidia(bullsih) :> "NVDA continues see strong spending trends AI upward revisions demand newer customers such Tesla various sovereigns"

• Wells Fargo reiterates Goldman Sachs(bullsih) :> "Overall capital markets revenue up YoY (best top U.S banks) driven higher IB [investment banking] trading

• Maxim initiates Apple(neutral) : > We initiating coverage Apple (AAPL) Hold rating $178 month price target based applying average forward P/E multiple big-tech companies FY25 EPS estimate

• Maxim initiates Amazon(bullsih) : > We initiating coverage Amazon (AMZN) Buy month price target based applying x EV/EBITDA multiple forecast

• Truist upgrades Strategic Education( **bullsih **) : > We upgrading Strategic Education(STRA)Buy increasing PT$

• Morgan Stanley upgrades Antero Resources( **bullsih **) :
  "With note upgrade Antero Resources Overweight see company providing attractive leverage rising gas prices leading exposure growing LNG fairway Gulf Coast"

• Raymond James upgrades Commerce Bancshares( **bullisih **) :
  "We upgrading CBSH shares Outperform Market Perform following release impressive Q results led us raise EPS estimates"

• Guggenheim upgrades Group Automotive( **buliisih **) :"Upgrading GPI BUY NEUTRAL best positioned dealer navigate current landscape somehow trading lowest multiple"

• Benchmark initiates Canoo( **buliisih **) :"initiating coverage GOEV Buy rating target price"

• loop reiterates Netflix( **buliisih **) :"believe NFLX improving engagement primarily due easing competitive environment traditional media companies raised prices scaled back content investment resumed licensing content NFLX"

• Jeffer