Analyst Calls: Tesla Cut to $145, Apple to $195, AT&T Upgraded

Key Takeaway

• Tesla's price target cut to $145 by Evercore ISI, while Apple upgraded to outperform by Bernstein with a $195 target.
• AT&T upgraded to overweight by Barclays; Southwest Airlines downgraded to underperform by Jefferies.
• General Dynamics and Eastman Chemical see positive outlooks from Jefferies; Dave Inc. initiated with market outperform by JMP.

Wall Street's Latest Moves

Wall Street analysts have made several significant calls affecting a range of sectors, from technology and telecommunications to airlines and retail. These insights provide a glimpse into the current market sentiment and future expectations.

Analysts Adjust Tech and Telecom Outlooks

Evercore ISI has adjusted its stance on Tesla, lowering the price target to $145 from $155, citing both the potential and risks of its robotaxi project. Meanwhile, Bernstein has shifted its view on Apple to outperform from market perform, encouraging investors to "buy the fear" ahead of earnings, with a maintained price target of $195. The firm highlights Apple's valuation and potential for a strong iPhone 16 cycle as key factors. Barclays has upgraded AT&T to overweight, pointing to improvements in growth quality and execution, contrasting with its downgrade of Lululemon to equal weight due to rising competition and a shift in consumer spending.

Airlines and Retail Under Review

Jefferies has downgraded Southwest Airlines to underperform, noting challenges as the carrier adjusts its market strategy post-pandemic. In retail, Barclays has downgraded Ulta Beauty to equal weight, citing increasing competitive pressures in the brick-and-mortar landscape. Conversely, Loop has upgraded FirstCash to buy from hold, suggesting that the current dip presents a buying opportunity.

Defense, Chemicals, and Fintech See Optimism

General Dynamics received an upgrade from Jefferies to buy from hold, with expectations of margin expansion. Eastman Chemical's outlook was also revised upwards by Jefferies, anticipating above-trend growth and improved margins. In the fintech sector, JMP initiated coverage of Dave Inc. with a market outperform rating, seeing significant upside potential.

Sector-Specific Highlights

In the defense sector, General Dynamics is expected to see margin expansion. The chemical industry, represented by Eastman Chemical, is anticipated to outperform with higher margins and better return on invested capital. The fintech sector sees optimism with Dave Inc., initiated with a market outperform rating by JMP.

Street Views

• Evercore ISI (Neutral on Tesla):

  "We continue to believe that robotaxi, on an accelerated timeline, needs to be analyzed for both its upside as well as immense RISKS associated with deploying an unmanned system carrying enormous liability to the parent."

• Jefferies (Bearish on Southwest Airlines):

  "LUV opened 18 new cities in the pandemic w/ development markets at 10% of network entering 2024, supposed to mature to the historical 4-5% by Q4. These dev markets are the critical underperformers w/ 4 cities cut and LUV poised to further cut losses in this foray."

• Jefferies (Bullish on General Dynamics):

  "We estimate GD expands defense margins 50 bps from 9.6% in 2023 (all-time low) to 10.1% by ’26."

• Barclays (Bullish on AT&T):

  "We upgrade T given the mismatch between valuation and improvements in growth quality and execution."

• Barclays (Neutral on Lululemon):

  "We downgrade LULU shares to Equal Weight from Overweight based on: Americas, while still solidly positive but decelerating, offset by China; athleisure normalization with potential marginal spend shifting back to apparel."

• JMP (Bullish on Dave Inc.):

  "We initiate coverage of Dave Inc. with a Market Outperform rating and $70 price target representing ~65% upside from the current price."

• JPMorgan (Bullish on Super Micro):

  "Super Micro is positioned with a strong product portfolio, which includes full rack scale solutions and liquid cooled systems, and a unique building block approach to product development that enables quick product refreshes amid the AI-led strong compute demand outlook."

• Oppenheimer (Bullish on Instacart): > "Within the Gig Economy, CART is our top pick followed by UBER."

• Bernstein(** Bullish **on Apple): > " We are upgrading AAPL from Market - Performto Outperformand maintaining our price targetof$195."

• Goldman Sachs(** Bullis h **on America Movil): > " We now expect results improveas competitive trendsare turning aroundand new capexguidancesupports cash generation."

• Jefferies(** Bullis h **on Eastman Chemical): > " Eastmanshould generate above-trend EPSgrowthhigher marginsand better[return invested capital] overthe next three years."

• Morgan Stanley(** Bullis h **on Axsome Therapeutics): > " Axsomeis developinga pipelineof therapiesfor[central nervous systems] indications."

• Berenberg(** Bullis h **on Nutrien): > " With all these issuesbehind itand reasonably goodQ423resultsinour viewNutrien’ssharesarebacktoa low$50level."

• Loo p( *B ulli sh *o n FirstCash ): >" W e ar eupgradingFirstCashtoa Buyfroma Holdratingwhileraisingourprice targetto$140from$125implying21 %upsidefromcurrentlevels ."

• Evercore ISI(*** B ulli sh ***o n Arista Networks ): >" W e ar eaddingANETtoourtacticalOPlistaheadoftheirEPScallonMay5 /7ou rpositivebiasisreallydrivenbythestockcorrectionoverthelastfewweeks ."

• Meli us(*** B ulli sh ***o n Nvidia ): >" N vidia reportsitsF1Q25onMay22ndandournewestimateof$24 .5Binrevenue(and $5 .60inEPS )including $20 .9BinrevenuefortheDataCentersegmentstilllooksconservative ."

• Citi(*** B ulli sh ***o n Shopify