Wall Street Analysts’ Actions: Apple Downgraded, Nike Named Top Pick

         

Apple receives second major downgrade while Nike is predicted to rebound after back-to-back down years. Meanwhile, analysts offer varying takes on other stocks including Mattel, Allstate, PayPal, American Express, and Analog Devices.

Analysts Lower Ratings on Apple, Highlighting Concerns Over Valuation and Handset Outlook

Piper Sandler downgraded Apple to neutral from overweight, citing valuation concerns, macro weakness, and a strained handset outlook. Barclays and Bernstein, on the other hand, named Nike as a top pick, expecting a turnaround after consecutive losing years.

Truist Financial Upgraded by Bank of America

Bank of America upgraded Truist Financial to buy from neutral, pointing to three reasons to buy including the company’s balance sheet positioning, focus on franchise efficiency, and superior growth potential in the Southeast.

Mattel Downgraded by Roth MKM Due to Excess Inventory Concerns

Roth MKM downgraded Mattel to neutral, expressing caution over the company’s outlook for 2024. The analyst highlighted excess inventory on retail shelves and lowered growth expectations, leading to an unfavorable risk-reward for the stock.

Morgan Stanley Turns Bullish on Allstate, Upgrades to Overweight

Morgan Stanley upgraded Allstate to overweight, citing higher personal auto growth and lower underwriting losses. The analyst sees the company as an ‘underappreciated story’ in a favorable market environment, with an attractive valuation relative to peer Progressive.

Oppenheimer Downgrades PayPal, Citing Persistent Profitability Pressure

Oppenheimer downgraded PayPal to perform from outperform due to persistent profitability pressure. The mix between branded and unbranded volumes is impacting the company’s ability to stabilize margins, raising concerns about future profitability and innovation.

JPMorgan Upgrades American Express, Downgrades Capital One Financial

JPMorgan upgraded American Express to overweight, viewing the credit card issuer as a ‘safe haven’ from weak household balance sheets. The firm also downgraded Capital One Financial to neutral, citing limited multiple expansion and better risk-reward elsewhere.

Bernstein Downgrades Analog Devices, Citing Valuation Concerns

Bernstein downgraded Analog Devices to market perform from outperform, expressing concerns about the company’s heightened multiple. The analyst believes that the stock may need time to grow into its elevated multiple and suggests there may be better investment opportunities in the space.

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