Thursday's analyst calls: Big upside for this EV stock, top bank picks for 2024
(This is CNBC Pro's live coverage of Thursday's analyst calls and Wall Street chatter. Please refresh every 20-30 minutes to view the latest posts.) Bank stocks and a major chipmaker were in focus Thursday. KBW named Goldman Sachs, Truist and KeyCorp as its top bank plays for the new year. Meanwhile, analysts around Wall Street reacted to AMD unveiling the Instinct MI300X, a chip aimed at competing with Nvidia's artificial intelligence semiconductors. Elsewhere, Stifel initiated Rivian with a buy rating, noting it sees big gains ahead for the EV maker. Check out the latest calls and chatter below. 9 a.m. ET: Match Group faces headwinds as competitors snatch its market share, says Wells Fargo Wells Fargo initiated shares of dating game platform company Match Group at an equal weight rating and a price target of $32, implying just 2.6% upside. Match Group owns Tinder, one of the most popular dating apps and still the favorite among users. But analyst Ken Gawrelski thinks competitor Hinge has been snapping away market share from Tinder, implying that growth hasn't been incremental to Match Group as a whole. "We found that the trajectory of MTCH share loss in those markets during 2023 hasn't been meaningfully different from share trends globally, suggesting Hinge app download growth is largely coming at the expense of Tinder," he wrote. — Lisa Kailai Han 8:45 a.m. ET: Raymond James upgrades Biogen, likes 2024 setup Raymond James is bullish on Biogen's prospects for next year, upgrading the stock to outperform from market perform on Thursday. The investment firm expects the launch of Biogen's Alzhiemer's drug Leqembi to pick up speed in 2024, analyst Danielle Brill said in a note to clients. The U.S. launch of its rare-disease treatment Skyclarys should also continue its strong pace and be bolstered by its approval and launch in the EU early next year, she said. "Pipeline prioritization and cost-cutting initiatives should improve OpEx margins over the long-run — and while Biogen's base commercial business has been on the decline due to competition and patent cliffs — we believe Leqembi and Skyclarys (from Reata acquisition) will help restore revenue growth," Brill wrote. Her $283 price target suggests 21% upside from Wednesday's close. Shares of Biogen are down nearly 16% year to date. — Michelle Fox 8:24 a.m. ET: JPMorgan hikes price target on Boeing Aerospace giant Boeing is heading in the right direction for its long-term free cash flow target, but it will still be a tricky road ahead, according to JPMorgan. Analyst Seth Seifman raised the price target for Boeing to $270 from $245, citing more optimism about the future cash profile of the company. But Seifman cautioned in a note to clients that success is not guaranteed for Boeing, even while keeping an overweight rating on the stock. "Out-year cash profitability should be considerably higher as these headwinds reverse and so we buy into the idea that 737 can contribute meaningfully to FCF growth; however, it is a steep climb from today's 737 profitability to Boeing's target and the path will likely include ups and downs," the note said. Shares of Boeing have surged more that 23% in the fourth quarter. BA mountain 2023-09-29 BA in Q4 "Despite big stock moves, the destination for Boeing remains the same in terms of mgmt's $10b target for FCF in the '2025-26 timeframe'. There is a lot of work to get there but we think the number is plausible," the note said. — Jesse Pound 7:50 a.m. ET: Bank of America downgrades Take-Two Interactive Bank of America downgraded shares of video game company Take-Two Interactive on Wednesday to neutral from buy. However, analyst Omar Dessouky maintained his $170 price objective, which implies an 8% increase from here. Dessouky is bullish the company's upcoming launch of the sixth installment in its Grand Theft Auto series, although he warned that the company has a track record of delaying launch dates. "Nonetheless, a later-than-implied launch date is already expected by most investors we spoke with, suggesting limited price impact should TTWO cut FY25 guidance," he wrote. Dessouky added that Bank of America currently holds a contrarian view, as it's just one of three brokers that have assigned a hold rating onto the stock. In contrast, 18 analysts have buy ratings. "Several factors could induce a rally beyond our $170 PO: (1) confirmation of FY25 guidance through summer 2024, (2) a gameplay trailer indicating an 'early 2025' launch, (3) a media hype cycle that drives a retail and institutional FOMO-driven momentum rally, (4) sudden acceleration of Zynga performance," the analyst added. — Lisa Kailai Han 7:35 a.m. ET: Bank of America hikes estimates for Wingstop There are no signs of a consumer slowdown at Wingstop , according to Bank of America. Analyst Sara Senatore said in a note to clients that high frequency data shows that customer traffic continues to grow at the specialty restaurant's locations. "We believe the traffic-driven YTD trend has persisted into 4Q, a notable outlier in an industry characterized by flat or negative same store traffic," the note said. The sales growth shows that Wingstop is continuing to bring in new customers, Senatore's note said. "Traffic growth is especially encouraging because it appears to comprise both repeat visits and new customer trial (WING acquired more new guests in 3Q23 than even during the chicken sandwich launch in in 3Q22)," the note said. Bank of America hiked its price target on Wingstop to $285 per share from $238. The bank analysts also revised up their estimates for revenue and earnings for the fourth quarter and the next two years. The new price target is 15% above where the stock closed on Wednesday. — Jesse Pound 7:34 a.m. ET: Wells Fargo initiates Bumble as overweight Wells Fargo is optimistic on Bumble's market share growth potential. The firm initiated an overweight rating and $19 price target on shares, implying shares could surge 36.4% from Wednesday's close. Analyst Ken Gawrelski thinks that even in spite of a slowing online dating market, the dating platform could add around 500,000 paying users per year in the medium term. He thinks Bumble is taking "meaningful share at the top of the funnel," mostly at the expense of Tinder. "We struggle to reconcile BMBL's current multiple (8x '25 EBITDA) w/ consistent share gain in online dating," Gawrelski wrote in a Thursday note. "While Bumble isn't a structural share gainer, it is benefiting from underinvestment at industry incumbent Tinder." Shares gained 1.6% Thursday before the bell. Nonetheless, the stock remains down nearly 34% year to date. — Hakyung Kim 7:25 a.m. ET: Thermo Fisher Scientific is a top pick going into 2024, Goldman Sachs says Goldman Sachs analyst Matthew Sykes listed Thermo Fisher Scientific as one of his top ideas going into 2024. Shares of the science supplies manufacturer have slipped 10% this year. However, Sykes' 12-month price target of $520 implies that shares of Thermo Fisher could rise 5% from here. Overall, Sykes is optimistic that the tools subsector can outperform the broader health care industry in 2024. "The Tools business model remains exceptional in our view, with high levels of recurring revenue facing multiple secular growth trends driven by continued spend in health and science innovation," the analyst wrote. — Lisa Kailai Han 7 a.m. ET: Stifel initiates Rivian with a buy rating, seeing 25% upside Rivian has a rosy growth outlook ahead, according to Stifel. The investment firm initiated coverage of the electric vehicle manufacturer with a buy rating, setting a target price of $23. This implies a 25% potential upside from the stock's Wednesday close of $18.38. "Electric vehicle sales have faced stiff headwinds recently, driven by both macroeconomic factors (high interest rates, inflation, and recessionary worries) as well as EV specific headwinds including range anxiety, vehicle costs, model availability, and charging infrastructure. We believe these EV hurdles will shrink over the next few years, paving the way for sales growth," wrote analyst Stephen Gengaro. As a specific catalyst, Gengaro pointed to Amazon's agreement with the company for 100,000 cargo vehicles. Rivian also addresses the largest vehicle segment in the U.S. Additionally, he also expects to see growing margins next year. "Several drivers of 2024+ margin expansion including new technology (Enduro motor and LFP battery), better pricing, EDV deliveries, new zonal architecture, rising production, and impact of new supplier agreements," he wrote. Rivian shares have struggled in 2023, falling slightly. However, the stock has bounced nearly 10% in December. — Lisa Kailai Han 6:41 a.m. ET: Bank of America lists Amazon as a top pick Bank of America is overwhelmingly bullish on Amazon , seeing improvements in the company's underlying fundamentals and naming the e-commerce giant a top pick. "Amazon remains our top pick in the U.S. given projected share gains and margin expansion from regionalization, ad contribution upside, and AWS acceleration," analyst Justin Post wrote. Specifically, Post sees advertising opportunities ramping up, primarily through Prime Video and partnerships with independent sellers. He's also bullish on the continued optimization of Amazon's regional logistics network, noting retail share gains will continue expanding in 2024 as faster deliveries lead to more frequent purchases. "Finally, we expect AWS revenue growth to reaccelerate to high-teens on easier comps and AI tailwinds," the analyst added. Post's $168 price objective implies that shares of Amazon could rally 16% from their Wednesday closing price. Amazon shares have already had a blockbuster year, rallying 72%. AMZN YTD mountain AMZN in 2023 — Lisa Kailai Han 6:35 a.m. ET: Morgan Stanley likes Oracle heading into earnings next week Morgan Stanley is feeling good about Oracle heading into the company's fiscal second-quarter results next week, expecting a rebound after a disappointing first-quarter report. "Investors remain squarely focused on Oracle Cloud Infrastructure (OCI) momentum but expectations have slightly moderated based on our conversations suggesting investors are still digesting the F1Q expectation miss, setting up for a potential bounce back in F2Q where we see several points that make us more comfortable on OCI achievability," wrote analyst Keith Weiss in a note from Thursday. The analyst was bullish on Oracle Fusion Applications, used for enterprise resource planning. "Ultimately, our channel checks which skew more upmarket support continued durability in Fusion applications growth, as partners continue to cite healthy backlogs and strong win rates consistent with prior quarters," he wrote. However, Weiss concluded that he'll remain on the sidelines so long as Oracle stocks continue to trade expensive, above their appropriate risk-reward tradeoff. Weiss has an equal-weight rating on the stock. His price target of $107 is 4.5% lower than the stock's Wednesday close of $112.03. — Lisa Kailai Han 6:08 a.m. ET: Bank of America names Nvidia a top pick Bank of America stuck by its buy rating for Nvidia and listed the chip manufacturer as a top pick following an investor meeting on Wednesday. "Takeaways [were] very positive on the size of the opportunity (excess of $250bn), importance to customers (4-5x [return on investment]), multi quarter visibility and underappreciated enterprise and sovereign demand drivers (71 countries interested)," wrote analyst Vivek Arya. "NVDA is still supply constrained but improving every quarter with multi quarter growth visibility, and well aligned with customers who take a year to design new AI data centers." Specifically, Arya highlighted that the company's genAI customers will receive $4 to $5 in returns for every $1 invested. Despite the company's year-to-date rally of more than 200%, the annual addressable opportunity of $250 billion will be less than a third penetrated by next year — meaning that there could still be significant opportunities ahead, the analyst wrote. The analyst's price objective of $700 means that shares of Nvidia could go flying nearly 54% from its Wednesday close of $455.03. NVDA YTD mountain NVDA in 2023 — Lisa Kailai Han 5:51 a.m. ET: What some analysts are saying after AMD's AI event Major banks stuck by their ratings following Advanced Micro Devices' December AI event. During the event, the semiconductor company showcased different opportunities in the AI space, as well as provided updates to their specific technologies and products, including the Instinct MI300X chip — which is aimed at competing with Nvidia's AI semiconductor offerings. JPMorgan, Citi, Morgan Stanley and Deutsche Bank all stood by their ratings for the stock, which respectively were neutral, buy, overweight and hold. "We believe that today's event highlighted how AMD remains extremely well positioned to take advantage of the rapidly expanding AI TAM, as they continue to stack up customer partnerships and roll out products with impressive (and extremely competitive) performance metrics," wrote Deutsche Bank analyst Ross Seymore, who expects Advanced Micro Devices to lead the data center accelerator market alongside Nvidia. However, the analyst maintains his hold rating on this stock until cyclical headwinds lessen or the valuation levels become more attractive. While the event was overall positive, Morgan Stanley analyst Joseph Moore wrote that it "did not break any new ground." Moore's price target of $128 corresponds to a 9.8% upside for the stock. At $110, Deutsche's Seymore has the most conservative price target, implying a downside of 5.8%. JPMorgan's December 2024 price target of $115 similarly sees a 1.6% decrease for the stock. On the other hand, Citi's $136 target price sees the stock rallying 16% from here. — Lisa Kailai Han 5:51 a.m. ET: KBW names its top bank picks for 2024, including Goldman Sachs KBW highlighted Goldman Sachs , Truist and KeyCorp as its top large-cap banks heading into 2024, citing a slew of bullish drivers. The firm likes Goldman "given the backdrop is becoming more favorable for capital markets in 2024 due to declining pressures on interest rates," analyst Christopher McGratty wrote. He also pointed to improving investment banking activity as a source of gains for the bank. As for Truist and KeyCorp, McGratty sees them benefiting from "significant" tangible book value growth and high return on average tangible common equity. The former should also capitalize on a rebound in capital markets. KBW has a outperform ratings on the three banks. Here's where it sees each stock going from here: Goldman Sachs: Price target of $400, which implies 17% upside Truist: Price target of $36, implying 9% upside KeyCorp: Price target of $15, pointing to 15.7% gains from Wednesday's close Banks overall have struggled in 2023, with the Invesco KBW Bank ETF (KBWB) losing 13%. Goldman is down marginally for the year, while Truist and KeyCorp lost more than 20% each. KBWB YTD mountain KBWB in 2023 — Fred Imbert