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Wall Street's Latest Picks and Pans: A Strategic Guide for Investors


Leo Gonzalez

March 1, 2024 - 13:17 pm


Wall Street's Latest Picks and Pans: Analysts' High-Conviction Moves

Investors seeking guidance on the ever-changing landscape of stock investments have been presented with a plethora of analyst ratings on Wall Street this Friday. Analysts’ viewpoints provide a closer look at various companies, ranging from food products to luxury goods, and from traditional manufacturing to cutting-edge tech firms.

D.A. Davidson's Fresh Take on Campbell Soup: A Recipe for Growth

Campbell Soup Company, an established presence in the pantry of many American households, has garnered a new level of interest from D.A. Davidson. The firm expressed a constructive stance, initiating coverage on Campbell Soup with an optimistic 'Buy' rating.

Analysts at the firm believe the company is approaching a turning point as it moves past the period of reduced pantry stocking and anticipates an easing in core inflation. These factors are expected to support a second-half fiscal year 2024 (July) inflection, as investors eye a potential uptick in the company's performance.

Morgan Stanley Shines a Spotlight on and Dell

Morgan Stanley maintains a keen eye on Chinese e-commerce giant, branding it a catalyst-driven idea while retaining an equal-weight rating. The firm anticipates bullish trends for as the company prepares to release its fourth-quarter results on March 6. Guidance for the first quarter of 2024, coupled with commentary on the full-year outlook, is highly anticipated to serve as a significant catalyst for the stock's performance.

Meanwhile, Dell Technologies, a key player in the computing industry, has kept its prestigious status as a top pick by Morgan Stanley. Following an earnings report that surpassed apprehensions, Dell's infrastructure recovery prospects are promising. However, it's the AI server segment that truly captivated attention, with a substantial quarter-over-quarter backlog increase and the pipeline closing the January quarter on a strong note.

TD Cowen and Goldman Sachs Offer Contrasting Industrial Insights

On the manufacturing front, TD Cowen upgraded Parker Hannifin Corporation due to its continuous impressive growth despite the downturn in orders and revenue for a substantial portion of its business sectors. The ability of the company to persistently carve out earnings per share growth, amidst such challenging conditions, is seen as particularly noteworthy.

In contrast, Goldman Sachs has taken decisive action within its coveted conviction buy list. The firm has ushered the Italian luxury fashion company Zegna into the list, propelled by its potential for a re-rating. Analyst Louise Singlehurst underscores Zegna's tilt towards the high-end luxury consumer market and anticipates earnings growth acceleration from the recent integration with Tom Ford.

Furthermore, Goldman Sachs updated its conviction buy list significantly; adding biotechnology firm Amgen, alongside cloud-based software company, and construction materials supplier Vulcan Materials. Conversely, it removed tech titan Apple, pharmaceutical company Merck, and biotechnology firm Vertex Pharmaceuticals.

Analyst Upgrades Abound: Vita Coco, Evolent Health, and Oshkosh

Stephens, a financial services firm, revised its stance on Vita Coco Company—a leader in the health-conscious beverage market—by elevating the stock from "equal weight" to "overweight." This upgrade arrives on the heels of an encouraging earnings report, where the coconut water maker showed resilience in the face of potential logistic cost challenges, further solidifying its dominance in its niche market.

Evolent Health, a company specializing in health care delivery solutions, has made a positive impression on Oppenheimer analysts. Initiating coverage with an "Outperform" rating and a favorable price target of $45, the health tech firm is perceived as well-positioned to capitalize on the evolving health industry dynamics.

D.A. Davidson's assessments have also shown a bullish perspective towards Oshkosh Corporation after investor meetings highlighted the company's potential. The firm upgraded Oshkosh from neutral to buy, signifying increased confidence in its trajectory.

Banking on Broadcom and Eli Lilly: Bank of America's Votes of Confidence

The semiconductor industry, a cornerstone of the tech sector, has witnessed Bank of America reiterate a 'Buy' rating on Broadcom Inc., citing an elevated price target in anticipation of the earnings report. The bank envisions only temporary volatility, even if fiscal year 2024 estimates remain largely unaltered. The prevailing sentiment is that any pullback in stocks would be short-lived, as attention shifts to Broadcom's AI Investor Day happening on March 20, alongside an appreciation for the company's robust dividend yield and growth as a 'low beta' AI beneficiary.

In the sphere of biopharmaceuticals, Bank of America sustains a 'Buy' rating on Eli Lilly and Company, lifting its price target significantly. The firm continues to favor Eli Lilly as a top contender within its coverage, driven by leading revenue growth, margin expansion possibilities, and an attractive pipeline, even considering its strong year-to-date performance.

Cautionary Downgrades: Fisker, New York Community Bancorp, and More

Citi has cast a scrutinizing eye on Fisker Inc., the aspiring electric vehicle manufacturer. Downgrading the stock from 'Buy' to 'Neutral,' analysts cited a disappointing fourth-quarter performance that brought to light financial reporting issues, a dimmer 2024 outlook, and concerns surrounding liquidity challenges.

New York Community Bancorp's stock rating took a hit as Piper analysts transitioned their recommendation from 'Overweight' to 'Neutral.' Recent disclosures by the bank generated worries that further complications may lie ahead, fueling a more conservative outlook for the regional banking institution.

Neutral Stances: Estee Lauder and Hewlett Packard Enterprise Under the Microscope

Goldman Sachs, a major player in investment banking, shifted their view on beauty giant Estee Lauder Companies Inc., prompting a downgrade to 'Neutral' from 'Buy.' The firm awaits improved clarity on the recovery of travel retail and the impact of cost-saving initiatives.

Wells Fargo shared their perspective on Hewlett Packard Enterprise, noting potential weaknesses within its networking segment. Despite the company's strategic positioning in high-performance computing and artificial intelligence, competitors appear to be making more robust progress in backlog turnover, causing Wells to lower their rating from 'Overweight' to 'Equal weight.'

Analysts' Mixed Feelings on Tech and Biosciences: Nvidia, Annexon, and GoodRx

Daiwa Securities stands firmly beside its 'Buy' rating on Nvidia, the tech behemoth at the forefront of AI and graphics processing. The firm sees Nvidia's current position akin to significant technological launches of the past and envisages even greater potential for AI to reshape global phenomena.

JPMorgan shifted gears on Annexon Biosciences, upgrading the stock to 'Overweight' based on its diverse pipeline prospects, accompanied by a new price target pointing to a positive long-term valuation.

Another notable upgrade came for GoodRx from JPMorgan, following the telemedicine platform's fourth-quarter earnings. Improvements in its output warranted a rating change from 'Neutral' to 'Overweight,' along with an increase in the December 2024 price target.

Embracing a Dynamic Market: Church & Dwight, Flynn Restaurant Group

Goldman Sachs formulated a strong opinion on consumer goods company Church & Dwight Co., bumping it up to 'Buy' from 'Neutral.' The assessment centers around heightened growth momentum anticipated due to an increase in distribution.

Lastly, Flynn Restaurant Group, the largest franchise operator in the U.S., has been subject to analysis by Morgan Stanley. Although the company's effective execution and robust business model continued to impress, the firm viewed the current stock levels as presenting a balanced risk/reward. Consequently, the recommendation was tempered to 'Equal Weight,' stepping aside from the 'Overweight' rating previously held.

Conclusion: Analysts Navigate a Sea of Opportunities and Risks

Wall Street thrives on continual analysis and a diversified portfolio of insights. Whether it's the allure of luxury markets or the practicality of pantry staples, the fervor for innovation in AI or the steadfastness of manufacturing prowess—analysts have provided a wealth of knowledge to digest. As investors mull over these recommendations, the strength of their convictions, and the shifting currents of the market, the one certainty remains the valuable role these analyses play in shaping investment strategies for a broad spectrum of individuals and institutions alike.

As we witness the ever-shifting paradigms of the global marketplace, these calls and perspectives from esteemed Wall Street firms offer investors a tapestry of potential outcomes. Spanning the gamut from technology to food, luxury to banking, these insights are intended to steer investors toward opportunities for growth and caution them against looming challenges. With these analyses at their disposal, market participants are better equipped to navigate the complex terrain before them.