Friday’s analyst calls: Solar stock gets a price target increase, Nike downgrades after earnings

Posted By: EN Todayon: June 28, 2024In: Renewable Energy News

(This is CNBC Pro’s live coverage of Friday’s analyst calls and Wall Street chatter. Please refresh every 20-30 minutes to view the latest posts.) A solar stock and an apparel giant were among the names being talked about by analysts on Friday. Several analysts downgraded Nike shares after the company posted its latest quarterly figures. Meanwhile, Deutsche Bank increased its price target on First Solar. Check out the latest calls and chatter below. All times ET. 7:19 a.m.: Rosenblatt downgrades Alphabet on ‘areas of transitional risk’ including AI Rosenblatt thinks Alphabet could have trouble finding meaningful growth overhead and sees “multiple areas of transitional risk.” As a result, the firm is moving to the sidelines on the Google-parent company. “Areas of risk include the AI’s impact on search — including the likely at least transitionally negative impact on search ad revenues of layering in AI Overviews,” analyst Barton Crockett said. “There is also nascent evidence of search share loss to Bing.” The firm downgraded Alphabet stock to neutral from buy, and lowered its price target to $181 per share from $182. Rosenblatt’s forecast implies about 2% upside from Thursday’s $185.41 close. “Over time, ad monetization in AI Overviews can ramp up,” the analyst added. “Consumers certainly seem to be overall favorable on the change, with 48% in a Tinuit survey saying it makes their search better. But this presents a transitional risk of ad slowdown near-term, akin to what Meta went through with Reels.” Alphabet stock has climbed nearly 33% in 2024. — Brian Evans 6:59 a.m.: JPMorgan upgrades Digital Realty Trust JPMorgan thinks shares of Digital Realty Trust can find a long growth runway ahead thanks to advancements in the cloud and an artificial intelligence tailwind. Analyst Richard Choe upgraded the real estate investment stock to overweight from neutral on Friday, and upped his price target to $175 per share from $150. JPMorgan’s forecast implies nearly 18% upside from Thursday’s $148.72 close. Digital Realty has advanced about 11% in 2024. “Management noted half its bookings last quarter were AI related and we see the company winning more deals going forward,” Choe said. “Digital Realty Trust is well positioned with its global portfolio of high density cloud focused data center portfolio and new development builds.” “Our outlook on the data center industry supports the view that data center demand is robust and the positive pricing environment could last for some period of time,” Choe added. — Brian Evans 6:30 a.m.: Morgan Stanley raises ASML price target Morgan Stanley thinks semiconductor stock ASML is poised for gains ahead thanks to an order book recovery and strong demand in China. “Our recent conversations with the company suggest some confidence in impending orders. We don’t think this is misplaced,” analyst Lee Simpson said. “We share a similar confidence regarding the likelihood of forthcoming orders to facilitate technology transitions, noting that whilst there is no guarantee they will come in 2Q, in order to meet stated time line targets, orders will need to come sooner rather than later,” the analyst added. Simpson reiterated an overweight rating on the chip stock and raised his price target to 1,100 euros from 1,000 euro amounting to nearly 13% upside from Thursday’s €974.20 close. Shares have climbed about 43% in 2024. — Brian Evans 5:47 a.m.: Here’s what analysts are saying after Nike’s fourth quarter results Shares of retailer Nike slipped more than 14% after fourth-quarter revenue undershot Wall Street’s expectations and a lackluster sales forecast. Nike also trimmed its full-year guidance. “FY25 was reset for the 2nd time in 3 months—as the digital weakness continued into 1Q, while the pacing to manage key franchises is being accelerated. Simply put, it’s difficult to find any good news in today’s release,” Wells Fargo analyst Ike Boruchow wrote. The analyst reiterated an overweight rating on Nike stock but slashed his price target to $92 per share from $115, equating to roughly 2% downside from Thursday’s close. NKE 1D mountain NKE falls Stifel downgraded Nike stock following results to hold from buy and reduced their price target to $88 per share from $117. The firm’s forecast amounts to nearly 7% downside moving forward. “Management credibility is severely challenged and potential for C-level regime change adds further uncertainty,” analyst Jim Duffy said. “We remain appreciative of NIKE’s scale advantage in a category with secular growth tailwinds and structural margin potential but, at the current valuation, can’t support a compelling upside case until growth inflection becomes more tangible.” UBS, Morgan Stanley and JPMorgan also downgraded Nike following earnings. “Nike’s 4Q report indicated its fundamental trends are much worse than we realized. Our key conclusion is there will be no quick rebound for Nike’s earnings,” UBS analyst Jay Sole wrote. He also lowered his price target to $78 per share from $125, or about 17% downside ahead. — Brian Evans 5:47 a.m.: Deutsche Bank raises First Solar price target First Solar shares have been on a tear this quarter, and Deutsche Bank expects even more gains ahead. The bank reiterated its buy rating on the solar stock and raised its price target to $280 from $215. The new forecast implies upside of 12% from Thursday’s close. “Despite the upcoming U.S. elections and the numbers of risks to the solar industry that could emerge in the coming months, we view as minimal the risk to see the 45x tax production credit being removed,” analyst Corinne Blanchard wrote. “Therefore, we believe First Solar is likely to further benefit from it, and we forecast $1.05bn of tax credits this year and $1.65bn in 2025,” she said. The stock is up more than 48% in the second quarter. FSLR mountain 2024-03-29 FSLR in Q2 — Fred Imbert