Wall Street Analysts' Top Picks and Market Trends: A Mid-August 2024 Overview

10 things to watch in the stock market Friday including more bullishness on Eli Lilly

10 things to watch in the market Friday, August 16 1. Wall Street is lower Friday morning after a strong session Thursday, which put the S & P 500 and Nasdaq Composite on track to record their biggest weekly gains since November 2023. Better-than-expected retail sales and initial jobless claims helped fuel Thursday's move, further demonstrating that good news about the U.S. economy is good news for stocks. 2. Applied Materials reported a better-than-expected quarter, but its fourth-quarter revenue guidance was merely in line with expectations. That's putting some pressure on the semiconductor equipment stock, which closed Thursday's session up nearly 31% year to date. 3. A handful of analysts boosted their price targets on Walmart after the retail giant's strong earnings report sent the stock to a record close Thursday. TD Cowen and Jefferies both raised their PTs to $85 a share from $80 and maintained their buy-equivalent ratings. Jefferies noted that Walmart executives said the company is using generative AI to make picking online orders more efficient. Despite questions on whether AI investments will pan out, that sounds like a real-word use case to us. 4. Bank of America downgraded Club name Estee Lauder to a hold-equivalent rating ahead of earnings next week, citing weakness in China's beauty market. Estee Lauder's significant exposure to that market has been a drag on its business for a while now. We sold some stock last month to free up cash for more attractive opportunities. 5. Guggenheim raised its price target on Club holding Eli Lilly to $1,030 a share from $884 and kept its buy rating. Improved supply of its booming GLP-1 drugs is a key driver of near-term business momentum, analysts said. Rapid advancements to Lilly's drug pipeline, though, is bolstering analysts' confidence that the momentum can be sustained in the future. During the Investing Club's Monthly Meeting earlier this week , Jim Cramer said Lilly has so far reported the best quarter of any stock in the portfolio. 6. Sphere Entertainment was upgraded to a buy-equivalent rating at JPMorgan. Analysts argued the company's operating model has been proven out while the venue "has established itself as a mainstay in the destination tourism market with travelers and artists alike." In addition to the buzzy Las Vegas venue, Sphere owns MSG Networks. Shares of Sphere are up 36% year to date. 7. Evercore ISI placed Club name Palo Alto Networks on its list of "tactical underperform" ideas ahead of the cybersecurity provider's earnings report Monday night. Analysts said their quarterly partner survey suggested the long-term trends for Palo Alto were intact, but the near-term implications were mixed. Elsewhere, Baird upped its PT on the stock to $375 from $360. 8. Wells Fargo doubled upgraded Fox Corp. to a buy-equivalent rating from underweight. Analysts said they've done extensive work on the forthcoming sports streaming service Venu -- a joint venture between Fox, Club holding Disney and Warner Bros. Discovery -- and see more opportunities than risks. The firm's price target on Fox is now $46 a share, up from $29. 9. Bank of America lifted its price target on Salesforce to $316 a share from $288 and maintained its buy rating on the Club stock. Ahead of Salesforce's fiscal Q2 earnings report later this month, analysts said their recent discussions point to deal activity remaining steady around first-quarter levels. 10. Texas Instruments is set to receive up to $1.6 billion in grants and up to $3 billion in loans from the U.S. government to help pay for three projects that will boost semiconductor manufacturing in the U.S. It's the latest funding announcement tied to the so-called CHIPS Act, which became law in 2022. Intel , GlobalFoundries and Samsung are among the other chip firms receiving financial support. Sign up for my Top 10 Morning Thoughts on the Market email newsletter for free (See here for a full list of the stocks at Jim Cramer's Charitable Trust.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED. 1. Wall Street is lower Friday morning after a strong session Thursday, which put the S&P 500 and Nasdaq Composite on track to record their biggest weekly gains since November 2023. Better-than-expected retail sales and initial jobless claims helped fuel Thursday's move, further demonstrating that good news about the U.S. economy is good news for stocks. 2. Applied Materials reported a better-than-expected quarter, but its fourth-quarter revenue guidance was merely in line with expectations. That's putting some pressure on the semiconductor equipment stock, which closed Thursday's session up nearly 31% year to date. 3. A handful of analysts boosted their price targets on Walmart after the retail giant's strong earnings report sent the stock to a record close Thursday. TD Cowen and Jefferies both raised their PTs to $85 a share from $80 and maintained their buy-equivalent ratings. Jefferies noted that Walmart executives said the company is using generative AI to make picking online orders more efficient. Despite questions on whether AI investments will pan out, that sounds like a real-word use case to us.

Jim Cramer's top 10 things to watch in the stock market Thursday

My top 10 things to watch Thursday, Aug. 15 1. Stocks were headed for a higher open Thursday after a batch of better-than-expected economic data boosted confidence in the health of the U.S. economy. Not long ago recession fears gripped the market, and there was a growing sense the Fed would need to cut interest rates by a half-percentage point at its September meeting. That's calmed down, with traders pricing in a nearly 75% odds of a traditional quarter-point reduction. 2. Retail sales in July rose 1% on a seasonally adjusted basis, well ahead of the 0.3% rise expected by economists polled by Dow Jones. Excluding auto-related purchases, sales were up 0.4% versus the 0.1% estimate. The second positive economic release: Initial jobless claims for the week ended Aug. 10 were 227,000, below the estimate of 235,000. After the July employment report fueled recession concerns, we've now seen back-to-back weeks of lower-than-expected initial claims. 3. In a further show of a stable consumer, Walmart beat on quarterly earnings and revenue. The Dow stock soared nearly 8% on the release. Strong e-commerce. Lifts full-year guidance , though a bit more cautious about the second half of the year. 4. Cisco Systems , another Dow stock, jumped 8% on Thursday after the networking company delivered a better-than-expected quarter with artificial intelligence in use. However, no number guide-up. Cisco also announced a plan to cut 7% of its global workforce. 5. Starbucks is giving incoming CEO Brian Niccol $85 million in cash and stock to leave Chipotle. I think it's worth holding on to the stock to see how Niccol does at the Club-owned coffee giant. Also, check out my updated views on all the stocks in the Club portfolio from our August Monthly Meeting, which was held on Wednesday. 6. Ulta Beauty jumped more than 10% after Warren Buffett's Berkshire Hathaway disclosed in a quarterly filing that it bought shares of the struggling retailer. It's a small buy by Berkshire standards, worth $266 million in the second quarter. It's possible Buffett lieutenants Ted Weschler and Todd Combs are behind the stake . 7. Bill Ackman's Pershing Square Capital Management revealed a stake in Nike . The Dow stock rose 4.5% on the filing news. CNBC reported in 2018 that Pershing made a $100 million profit trading in and out of Nike over a six-month period. 8. KeyBanc upgraded Chili's parent Brinker International to a buy-equivalent rating, arguing its 10.7% post-earnings decline Wednesday creates a compelling entry point into the restaurant stock. I agree with this. It was a great quarter all things considered, and there is much work to be done to make CEO Kevin Hochman's changes stick. 9. Alibaba missed on quarterly earnings and revenue. It shows how horrendous the Chinese economy is. The numbers reflect rising competition and a cautious Chinese consumer. The stock dropped 1.5%. Alibaba's overseas online shopping businesses continued to be a bright spot . 10. Shares of Tapestry , the company behind luxury brands Coach and Kate Spade, gained 6.5% on better-than-expected earnings and revenue. Some negative impact to full-year guidance related to the suspension of share repurchases due to Tapestry's proposed acquisition of the Versace, Jimmy Choo, and Michael Kors company Capri . Sign up for my Top 10 Morning Thoughts on the Market email newsletter for free (See here for a full list of the stocks at Jim Cramer's Charitable Trust.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust's portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED. 1. Stocks were headed for a higher open Thursday after a batch of better-than-expected economic data boosted confidence in the health of the U.S. economy. Not long ago recession fears gripped the market, and there was a growing sense the Fed would need to cut interest rates by a half-percentage point at its September meeting. That's calmed down, with traders pricing in a nearly 75% odds of a traditional quarter-point reduction. 2. Retail sales in July rose 1% on a seasonally adjusted basis, well ahead of the 0.3% rise expected by economists polled by Dow Jones. Excluding auto-related purchases, sales were up 0.4% versus the 0.1% estimate. The second positive economic release: Initial jobless claims for the week ended Aug. 10 were 227,000, below the estimate of 235,000. After the July employment report fueled recession concerns, we've now seen back-to-back weeks of lower-than-expected initial claims. 3. In a further show of a stable consumer, Walmart beat on quarterly earnings and revenue. The Dow stock soared nearly 8% on the release. Strong e-commerce. Lifts full-year guidance, though a bit more cautious about the second half of the year. 4. Cisco Systems, another Dow stock, jumped 8% on Thursday after the networking company delivered a better-than-expected quarter with artificial intelligence in use. However, no number guide-up. Cisco also announced a plan to cut 7% of its global workforce. 5. Starbucks is giving incoming CEO Brian Niccol $85 million in cash and stock to leave Chipotle. I think it's worth holding on to the stock to see how Niccol does at the Club-owned coffee giant. Also, check out my updated views on all the stocks in the Club portfolio from our August Monthly Meeting, which was held on Wednesday. 6. Ulta Beauty jumped more than 10% after Warren Buffett's Berkshire Hathaway disclosed in a quarterly filing that it bought shares of the struggling retailer. It's a small buy by Berkshire standards, worth $266 million in the second quarter. It's possible Buffett lieutenants Ted Weschler and Todd Combs are behind the stake. 7. Bill Ackman's Pershing Square Capital Management revealed a stake in Nike. The Dow stock rose 4.5% on the filing news. CNBC reported in 2018 that Pershing made a $100 million profit trading in and out of Nike over a six-month period. 8. KeyBanc upgraded Chili's parent Brinker International to a buy-equivalent rating, arguing its 10.7% post-earnings decline Wednesday creates a compelling entry point into the restaurant stock. I agree with this. It was a great quarter all things considered, and there is much work to be done to make CEO Kevin Hochman's changes stick. 9. Alibaba missed on quarterly earnings and revenue. It shows how horrendous the Chinese economy is. The numbers reflect rising competition and a cautious Chinese consumer. The stock dropped 1.5%. Alibaba's overseas online shopping businesses continued to be a bright spot. 10. Shares of Tapestry, the company behind luxury brands Coach and Kate Spade, gained 6.5% on better-than-expected earnings and revenue. Some negative impact to full-year guidance related to the suspension of share repurchases due to Tapestry's proposed acquisition of the Versace, Jimmy Choo, and Michael Kors company Capri.

Here are Thursday's biggest analyst calls: Apple, Dell, Amazon, Broadcom, CrowdStrike, PNC, & more

Here are the biggest calls on Wall Street on Thursday: Morgan Stanley reiterates Apple as overweight The firm says it's bullish heading into the new Apple iPhone cycle. "While early October iPhone sell-through still most critical for next cycle growth, momentum seems to be building into the iPhone 16 launch." Wells Fargo downgrades M & T Bank to underweight from equal weight Wells said in its downgrade of the regional bank that lower rates are "not ideal." " MTB has an above avg. est. P/E even though it is more exposed to lower rates given it's a more plain vanilla, NII-oriented bank [net interet income], w/greater CRE and increased competition in its slower growth footprint." UBS upgrades Dutch Bros to buy from neutral UBS said in its upgrade of the coffee chain that Dutch Bros shares are too attractive to ignore at current levels. "Upgrade to Buy: Compelling sss [same-store sales] catalyst path, attractive LT unit growth intact." Baird initiates Valvoline as outperform Baird said it sees several sustainable drives for the auto services company. " VVV is a trusted leader in the large, fragmented, and needs-based/recession-resilient auto services industry." Goldman Sachs upgrades Progressive to buy from neutral Goldman says it's getting bullish on shares of the auto insurance company. "The premise of our upgrade is stronger and more sustainable PIF [policies in force] growth at PGR than we see reflected in street estimates." Piper Sandler initiates Tyra Biosciences as overweight Piper says it's bullish on shares of the biotech oncology company. "Initiating coverage of TYRA shares with an OW rating, $33 price target as we think this company's expertise in FGFR [fibroblast growth factor receptor] biology positions it well to overcome key limitations of earlier generation FGFR inhibitors." Morgan Stanley upgrades Victoria's Secret to equal weight from underweight Morgan Stanley said it's more constructive on the stock following management changes. "We upgrade VSCO to Equal-weight, as 1) leadership changes put turnaround hopes back in play, 2) 2Q upside makes for an achievable 2H bar..." UBS upgrades Medtronic to neutral from sell UBS said in its upgrade of the medtech stock that it sees a "diabetes turnaround." "We are upgrading MDT to Neutral from Sell as we now have higher conviction that the recent Diabetes turnaround is sustainable." Citi downgrades European Wax Center to neutral from buy Citi downgraded the body wax center company citing too much uncertainty. "We are downgrading EWCZ shares from Buy to Neutral and lowering our TP from $16 to $5.50 following 2Q EPS." JPMorgan downgrades bluebird bio to neutral from overweight JPMorgan downgraded the biotech company following earnings. "We're downgrading BLUE shares to N from OW following the 2Q results update. ... .Indeed, we see sentiment being further hurt by the aggregate commercial outlook into 2H24 being more encouraging than that exiting 1Q." JPMorgan upgrades Sea Limited to overweight from neutral JPMorgan said the Singapore-based tech conglomerate is "firing on all cylinders" "We are upgrading SE to OW as all three major business segments are likely to drive positive earnings revisions." Deutsche Bank upgrades Robinhood to buy from hold Deutsche says it sees upside potential for the stock trading company. "We upgrade Robinhood Markets (HOOD-Buy), joining Buy-rated Charles Schwab within our e-brokers, and we see over 20% upside potential for both stocks over the next 12 months." KeyBanc upgrades Brinker to overweight from sector weight Key said investors should buy the dip on shares of the owner of brands like Chili's. "We are upgrading EAT stock to OW and establishing a $72 PT. Our call follows an ~11% post-results decline in EAT shares." Morgan Stanley upgrades Nucor to overweight from equal weight Morgan Stanley says the steel company has defensive characteristics. "We are upgrading NUE to OW given our preference for lower beta/defensive exposure in 2H24 with a new price target of $176/share." Wells Fargo downgrades Snowflake to equal weight from overweight Wells said in its downgrade of the stock that its survey checks show "potential churn" from a recent data breach. " SNOW's premium multiple tougher to defend w/ tech differentiation in question in rapidly evolving era of open data formats. New mgmt, macro impacts & recent data breach (w/ potential churn) stacking up at a tough time." JPMorgan adds Dell to the focus list JPMorgan said Dell shares are compelling at current levels. "Dell, on the other hand, offers an attractive entry point from a valuation perspective after the recent pull-back with near-term margin focus from investors preventing them from appreciating the revenue TAM [total addressable market] accessible to Dell, particularly as the AI investment cycle moves to Enterprises benefitting Dell both on Servers and Storage." Bank of America upgrades PNC to buy from neutral Bank of America called the regional bank an "all weather stock." "We are upgrading our rating on PNC Financial to Buy from Neutral and raise PO to $200 from $185 driven by the positive EPS revisions and assigned multiples." Bank of America downgrades Pilgrim's Pride to neutral from buy Bank of America downgraded the poultry producer due to tough comps. "We are downgrading shares of Pilgrim's Pride (PPC), the 2nd largest broiler (chicken) processor in the US, from Buy to Neutral while maintaining our estimates & $47 PO still based on 6x CY25 EV/EBITDA." Goldman Sachs reiterates CrowdStrike as buy Goldman says it's sticking with shares of CrowdStrike . "Risk/reward may be turning more positive; October quarter key to establishing a floor to growth." Bernstein reiterates Amazon as a top idea Bernstein said Amazon is a top pick at the firm amid the recent market volatility. "Reset expectations while the OI [operation income] inflection story remains intact with further contribution from robust AWS growth, advertising re-acceleration in 2H24 from Prime Video ad ramp, and steady retail margin expansion while prioritizing gross profits." Bernstein reiterates Broadcom as a top idea The firm says Broadcom is the "cheapest way to play AI in semis." "A de-risked core (non-AI) semiconductor business with a good 2025 set-up..." Stifel initiates Advanced Energy Industries as buy The firm says the supplier of power delivery subsystems is well positioned. "We are initiating coverage of Advanced Energy Industries with a Buy rating on the shares." Oppenheimer reiterates Ulta as outperform Oppenheimer said it's sticking with Ulta shares following news on Wednesday that Berkshire Hathaway took a stake in the beauty company. "Earlier [Wednesday], Warren Buffett's Berkshire Hathaway disclosed a new stake of 690K shares in ULTA Beauty. Shares are indicated up ~10% to the high-$360s after market." UBS upgrades Millicom to buy from neutral UBS says the LatAm telecom company is well positioned. "We upgrade TIGO to Buy with a new PT of $33.00 (vs. $25.00 before)."