ACM Research upgrade, Zalando downgrade and Amazon initiation among today's top calls on Wall Street
Top Upgrades:
Goldman Sachs added Buy-rated Southern Company (SO) to the firm's Conviction List, keeping an $80 price target on the shares. The firm views Southern Company as uniquely positioned to provide above average clean energy growth from nuclear, while having below average regulatory risk within its regulated utility.
Wolfe Research upgraded Lazard (LAZ) to Peer Perform from Underperform without a price target in conjunction with a Q2 earnings preview. The stock is "heavily discounted" versus peers on normalized 2025 earnings estimates and carries an attractive dividend yield, says Wolfe.
Jefferies double upgraded ACM Research (ACMR) to Buy from Underperform with a price target of $23.40, up from $9. The Dutch government announced advanced semiconductor processor export rules last Friday, allowing the export of ASML's (ASML) oldest Arf immersion machine, NXT1980Di, the firm notes.
Top Downgrades:
HSBC downgraded Zalando (ZLNDY) to Hold from Buy with a price target of EUR 26, down from EUR 45. The firm cites slower gross merchandise recovery in 2024 and lack of near-term catalysts for the shares.
Goldman Sachs downgraded Symrise (SYIEY) to Neutral from Buy with a price target of EUR 97, down from EUR 115. The firm believes the likelihood of a second half recovery for the ingredients space is "now near-zero," and it expects volume momentum to improve only from Q1 of 2024 due to soft comparables.
BofA downgraded Elisa (ELMUG) to Underperform from Neutral with a price target of EUR 49, down from EUR 55. Given the stock's "premium valuation" versus Nordic telecom peers, less sequential improvement could make trading for Elisa more difficult from the second half of 2023, the firm says.
Top Initiations:
DBS Bank initiated coverage of Amazon.com (AMZN) with a Buy rating and $150 price target. DBS expects Amazon's retail segment operating income to be a key driver of share price from 2023 onwards, "dethroning" Web Services' operating income.
Citi resumed coverage of Lucid Group (LCID) with a Neutral rating and $8 price target. Given the stock's relative valuation, recent EV price discounts and the time gap until Gravity SOP, a bullish stance on the stock requires some conviction on the H2 Air volume ramp and margin progression, the firm says.
BofA initiated coverage of Reneo Pharmaceuticals (RPHM) with a Buy rating and $23 price target. Lead asset mavodelpar's upside has been "overlooked by the Street" ahead of its pivotal phase 2 readout, says the firm, which a sees the potential for first approval by year-end 2024 or early 2025 in Primary Mitochondrial Myopathy, or PMM, and "several additional indications poised to follow."
H.C. Wainwright initiated coverage of LifeMD (LFMD) with a Buy rating and $9 price target. The firm says the company's "robust" sales growth, "solid" gross margin, and near-term potential to achieve positive free cash flow compare favorably to competing players in the sector.
H.C. Wainwright initiated coverage of Ensysce Biosciences (ENSC) with a Buy rating and $9 price target. The firm says the chemical reactivity and metabolism profiles of the company's technologies offer a "unique way to address prescription drug abuse and minimize drug overdose at the molecular level - something the pain management community has never seen before."