Apple, Lineage, OneStream initiated: Wall Street’s top analyst calls

The most talked about and market moving research calls around Wall Street are now in one place. Here are today’s research calls that investors need to know, as compiled by The Fly.

Top 5 Upgrades:

• BTIG upgraded CareDx (CDNA) to Buy from Neutral with a $40 price target following the news last Friday afternoon that Medicare contractor Palmetto GBA decided it will not finalize the more restrictive proposed draft LCD issued in August 2023. Following Friday’s update, the 2024 guidance and numbers look increasingly conservative and CareDx’s legal matters seem to be manageable in light of Medicare’s new approach, BTIG says.
• Gordon Haskett upgraded Burlington Stores (BURL) to Buy from Hold with a $300 price target as the firm is raising its Q2 comp growth estimate to 4.0% from 2.0% previously ahead of the company’s earnings print. The firm, which expects Burlington’s 2.0 Strategy to drive improved comps and margins in the years ahead, notes that quarter-to-date traffic through the first two weeks of Q3 has stayed strong and with a very favorable weather backdrop.
• BTIG upgraded Taylor Morrison (TMHC) to Buy from Neutral with a $78 price target after hosting investor meetings with management last week. The firm cites valuation for the upgrade, and says it has increased confidence in the roadmap for how Taylor Morrison gets to its long-term structural goals beyond the next 12 months.
• Loop Capital upgraded Prog Holdings (PRG) to Buy from Hold with a price target of $55, up from $41, implying 26% upside from current levels. The firm is encouraged by the “proactive steps” management has been taking recently to reaccelerate volume growth, including co-branded marketing programs and improved e-commerce checkout integration with existing retail partners and reinvigorating its regional small business.
• RBC Capital upgraded Gates Industrial (GTES) to Outperform from Sector Perform with a price target of $22, up from $20. The analyst believes the company’s cost savings and footprint optimization will drive margin upside.

Top 5 Downgrades:

• Morgan Stanley downgraded HP Inc. (HPQ) to Equal Weight from Overweight with an unchanged price target of $37. The analyst now sees limited upside to the stock’s valuation and consensus estimates.
• Piper Sandler downgraded Shake Shack (SHAK) to Neutral from Overweight with a price target of $114, down from $121. Coming out of earnings season, the firm is tempering its view on the fast casual sub-sector and for Shake Shack in particular the firm thinks the risk-reward has become more balanced at current levels.
• Benchmark downgraded Codexis (CDXS) to Hold from Buy with no price target. The firm cites negative quarterly earnings comparisons and the extended period of time before the company’s long-range projects mature and begin to create more positive growth metrics.
• Piper Sandler downgraded Sweetgreen (SG) to Neutral from Overweight with a price target of $39, up from $33. Sweetgreen’s Infinite Kitchen technology “remains incredibly encouraging, and is arguably still underappreciated by many in the investment community,” but the firm thinks the stock’s risk/reward has become more balanced at current share levels.
• Morgan Stanley downgraded Hamilton Insurance (HG) to Equal Weight from Overweight with an unchanged price target of $19. With the stock above the firm’s price target of $19, the firm believes the upside from here is more limited.

Top 5 Initiations:

• Goldman Sachs initiated coverage of Lineage (LINE) with a Buy rating and $105 price target. The analyst expects the company’s earnings growth will be driven by a re-acceleration in same store operating income growth due to increased demand and a return to more normal seasonality in 2025 and 2026 while cost saving initiatives are realized. Lineage was also initiated at several other firms, including JPMorgan, Mizuho, Baird, Morgan Stanley, and Wells Fargo.
• Wells Fargo initiated coverage of Concentra (CON) with an Overweight rating and $27 price target. Wells sees Concentra’s growth/risk profile as the dominant player in occupational health and strong value for customers as more than offsetting current economic risks, the analyst tells investors in a research note. Concentra was also initiated at JPMorgan, Truist, Mizuho and Goldman Sachs.
• JPMorgan initiated coverage of OneStream (OS) with an Overweight rating and $30 price target. The firm likes the company’s customer “stickiness,” with 98% gross retention on par with ServiceNow, and organic platform, which it believes creates a foundation for rapid enhancement. OneStream was also initiated at BTIG, Citi, Morgan Stanley, and Wolfe Research, among other firms.
• MoffettNathanson initiated coverage of Apple (AAPL) with a Neutral rating and $211 price target. The “good news” is that Apple is “poised to win in AI,” but the “bad news” is that is “exactly what’s already priced in,” the analyst tells investors in the firm’s initiation note.
• Barclays initiated coverage of Heico (HEI) with an Equal Weight rating and $250 price target. The analyst expects the company’s relative growth to moderate as the aerospace aftermarket decelerates.