(This is CNBC Pro’s live coverage of Wednesday’s analyst calls and Wall Street chatter. Please refresh every 20-30 minutes to view the latest posts.) Wednesday’s big market calls saw analysts give mostly rave reviews to Amazon’s earnings beat the day before, with most citing cost-cutting measures and the firm’s utilization of artificial intelligence. Elsewhere, JPMorgan issued a contrarian call on battered 3M shares, saying the industrial products maker offers good value after shares fell sharply this year while the company beat on earnings. Along the contrarian lines, UBS reiterated its buy rating on Under Armour. Starbucks wasn’t as fortunate, getting a downgrade from Deutsche Bank following an earnings letdown. Check out the latest calls and chatter below. All times ET. 8:15 a.m.: KeyBanc upgrades Dollar Tree, sees strong second-half of the year Discount store chain Dollar Tree could be ready to rebound, more than two years removed from the stock’s post-pandemic high, according to KeyBanc. Analyst Brad Thomas upgraded the stock to overweight from sector weight, saying in a note to clients that Dollar Tree’s fundamentals should improve in the second half of 2024. “We see Rationalization of stores in the sector benefiting comps and profitability, and headwinds from Inflation, shrink, and SNAP moderating,” the note said. Dollar Tree also owns the struggling Family Dollar franchise, which could be sold in the coming years. “While Family Dollar struggles, its immaterial contribution to EPS positions it for turnaround or divestiture, with the potential for Shareholder ‘frustration’ (not necessarily activism, since that already exists) if necessary,” Thomas wrote. — Jesse Pound 8:07 a.m.: Wedbush upgrades Seagate Technology to outperform There’s upside ahead for Seagate Technology , according to Wedbush. The financial institution upgraded shares of the data storage company to an outperform rating from neutral. Analyst Matt Bryson’s 12-month price target of $100 corresponds to a 16% rally for the stock. As a catalyst, Bryson cited improving demand for hard disk drives, which could create further upside for Seagate stock in the near term. The analyst also noted his increasing conviction that Seagate’s heat assisted magnetic recording is ultimately a “good” technology, despite some obstacles that have plagued its production line in recent times. “While we believe there are still some manufacturing challenges that likely need to be resolved to get the full benefit of HAMR, we believe the fundamental issues are behind STX,” he wrote. “We see AVGO’s recent purchase of STX’s SoC work as very much validating HAMR’s technology path/progress as Broadcom CEO, Hock Tan notably does not invest in green shoots.” Shares of Seagate are currently trading flat on the year. â Lisa Kailai Han 7:16 a.m.: UBS reiterates rare buy rating on Under Armour UBS is standing out amongst the crowd due to its bullish stance on shares of Under Armour . The bank reiterated its buy rating on shares of Under Armour ahead of the sportswear manufacturer’s latest quarterly earnings release, due out on May 7. Analyst Jay Sole acknowledged that sentiment around Under Armour is mostly bearish, with shares down more than 23% for this year. However, the analyst’s 12-month price target of $12 implies that Under Armour stock could rally 78% from its Tuesday close. As a catalyst for a potential turnaround in performance, Sole highlighted that Under Armour likely outperformed its sell-side expectations in the fourth quarter. “We expect the company could guide 0% to +2% FY25 sales growth and $0.53-$0.58 EPS. This would be below the sell-side’s expectation but likely slightly above the market’s view since sentiment around UAA is bearish,” the analyst wrote. Sole added that the stock has historically traded within a 9.8% range post earnings, although he expects less volatility this time due to an unyielding market thesis. â Lisa Kailai Han 7:05 a.m. ET: JPMorgan upgrades Fifth Third Bancorp to overweight Fifth Third Bancorp’s balance sheet gives it a leg up over its competitors, according to JPMorgan. JPMorgan analyst Vivek Juneja upgraded the regional bank stock to an overweight rating from neutral, simultaneously lifting his price target to $39.50 from $37.50. This updated target corresponds to an 8% upside for shares of Fifth Third . Juneja noted an extremely positive outlook for the regional bank’s net interest income. Due to its maturing fixed income assets, Fifth Third it is likely to benefit more than its peers from rates staying at higher levels for longer. “It has a larger share of securities maturing in 2024 and a lower securities yield overall than peers and lower yields on maturing securities,” the analyst added. “Fifth Third is also well positioned if rate cuts come sooner than expected due to faster benefit to its funding costs, and if the economy softens it is better positioned in credit quality because it has a lower share of higher risk loans such as non-prime consumer loans and commercial real estate.” Shares of Fifth Third are up nearly 6% this year. â Lisa Kailai Han 6:52 a.m.: JPMorgan downgrades Logitech, cites challenging macro environment JPMorgan believes that Logitech International is running out of room for upside. The bank downgraded the hardware producer to a neutral rating from overweight. Analyst Samik Chatterjee also decreased his price target to $85 from $92, which still implies that Logitech stock could rise 8% from their Tuesday closing price. Shares of Logitech have slipped nearly 18% this year. Chatterjee cited a troubling macroeconomic backdrop as a reason for his downgrade. “We are downgrading shares of Logitech, even as the quarter showed continued signs of robust execution, as we believe the rebound of the product portfolio to healthy growth in the medium term will remain constrained by a challenging macro and efforts to drive growth will likely need to return to robust promotional levels,” he wrote. As evidence of this, the analyst pointed to Logitech’s revenue guidance for its 2025 fiscal year, which Chatterjee said came below its long-term levels. â Lisa Kailai Han 6:27 a.m.: Deutsche Bank downgrades Starbucks after disappointing quarterly earnings Starbucks could feel some near-term pressure, according to Deutsche Bank. The bank downgraded the coffee retail chain to a hold rating from buy. Analyst Lauren Silberman accompanied the move by lowering her price target to $89 from $108. This updated objective implies that shares of Starbucks could rise less than 1%. Silberman cited Starbucks’ less-than-impressive fiscal second-quarter earnings as a reason for the change. Shares of Starbucks were trading nearly 13% lower before the opening bell after the company missed both earnings and revenue consensus estimates. The company also slashed its earnings and revenue forecast for its 2024 fiscal year. “We are downgrading SBUX to Hold following a challenging F2Q print that showed signs that headwinds are more pervasive and persistent than we expected, and we have limited visibility into the pace and magnitude of a recovery,” Silberman said. Although Starbucks’ upcoming product pipeline shows promise, Silberman expressed her concern that waning foot traffic and increasing competition from smaller peers could further pressure Starbucks lower this summer. “We believe it is difficult to underwrite a meaningful reacceleration, particularly in a more challenging, value-seeking environment,” the analyst wrote. “China remains weak amidst a cautious consumer backdrop and increasing competitive intensity, and the trimmed unit growth guide likely adds to concerns on the growth outlook.” â Lisa Kailai Han 6:22 a.m.: JPMorgan goes against consensus to upgrade 3M to overweight The tide could be shifting when it comes to 3M , according to JPMorgan. The bank upgraded the maker of industrial products to an overweight rating from neutral. Analyst C. Stephen Tusa also raised his price target to $111 from $110, implying that shares of 3M could rally 15% from here. 3M stock has added nearly 6% so far in 2024, but the stock is still trading at an attractive valuation given the company’s characteristics, Tusa said. “Underlying fundamentals are showing modest improvement and EPS growth is turning, with exposure to bottoming electronics markets,” the analyst wrote. “We also think 3M offers a degree of cheap defense in a potentially more choppy tape, while an increase in rates actually benefits the calculation in discounting the liability burden here, with a balance sheet that is stronger than we think most appreciate given the Solventum dividend and stake.” Tusa also cited 3M’s first-quarter results as a catalyst. The company posted earnings of $2.39 per share on revenue of $7.72 billion, topping analysts’ expectations of $2.10 per share on adjusted revenues of $7.63 billion from the LSEG consensus. 3M also cut its dividend for the first time in 64 years after spinning of its healthcare unit earlier in April. “We acknowledge the unknowns, but think our estimate of a doubling in the current liability burden, the timing around which is unclear, leaves plenty of leeway for upside near term,” Tusa said of the dividend cut catalyst. He added that he’s upgrading 3M while it’s still highly out of favor with Wall Street, with only one other analyst assigning the stock a buy rating. â Lisa Kailai Han 6:14 a.m.: Here’s how Wall Street is reacting to Amazon’s blockbuster first-quarter earnings Amazon released its first-quarter earnings on Tuesday, and the e-commerce platform beat analyst expectations for both its first-quarter earnings and revenue, while its operating income added more than 200%. Amazon’s profit also tripled to 98 cents per share from 31 cents a year ago. Shares of Amazon were up more than 2% in premarket trading. The stock is now 15% higher on the year. After Amazon’s earnings release, the major banks reiterated their optimistic stances around the stock. Barclays, Bank of America, JPMorgan and Morgan Stanley all stood by their overweight-equivalent ratings. Multiple analysts also stated that Amazon was one of its top stock picks. Amongst the group, JPMorgan analyst Doug Anmuth has the highest price target of $240, which implies that Amazon stock could rally another 37% from here. The analysts highlighted Amazon Web Services’ severe cost-reduction measures as a major driver of upside. These cost discipline strategies included more regimented spending and slower headcount growth. Additionally, the Wall Street firms also noted that Amazon’s artificial intelligence tailwinds are finally materializing. “AMZN’s greater capital intensity â which is coming mostly in AWS â is driven by increased demand for cloud services and GenAI. We believe this is positive as AMZN has a very clear path to monetization of infrastructure investments through AWS, & has a track record of favorable returns,” wrote JPMorgan analyst Anmuth. â Lisa Kailai Han â CNBC’s Michael Bloom contributed to this report.
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