(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.) A pharmacy operator and an industrial stock were among the stocks being talked by analysts on Thursday. Barclays upgraded CVS to overweight from equal weight, calling for 24% upside. Meanwhile, JPMorgan lowered its rating on Honeywell International to neutral from overweight. Check out the latest calls and chatter below. All times ET. 7:50 a.m.: JPMorgan hikes Roku estimates ahead of earnings season Roku’s business appears to be gaining strength in the second half of the year, according to JPMorgan. Analyst Cory Carpenter raised revenue revenue estimates and the price target for the streaming video company, saying in a note to clients that advertising was strong. “Overall, we’re increasing our 3Q Platform revenue from 9% Y/Y to 11% (above 9% guide) and our 4Q Platform revenue from 11% to 12%. We expect Roku to deliver strong Platform results on the combination of stable macro/ad trends intra-qtr, our checks suggesting robust political spend, and to a lesser extent Olympics contribution,” Carpenter said. Carpenter bumped up the price target on Roku to $92 per share from $90. The new target is nearly 19% above where the stock closed Wednesday. Roku has not yet announced its third-quarter earnings date. Last year, the company reported the results in early November. — Jesse Pound 7:48 a.m.: UBS upgrades EVgo to buy on decreased odds of an Republican sweep UBS sees some major tailwinds ahead for EVgo . The bank upgraded shares of the electric vehicle charging company to buy from neutral. Analyst William Gripping accompanied the move by hiking his price target to $8.50 from $4. Shares of EVgo have surged 97% this year and could rise another 20% from here, according to Gripping’s new price forecast. As a catalyst, the analyst cited the $1.05 billion loan conditional commitment EVgo received last week from the Department of Energy. “In our view, the conditional commitment provides increased visibility to EVGO funding new stall deployments beyond 2025, at a potentially accelerated pace relative to current run-rate expectations,” he wrote. “Importantly, we do not expect EVGO to need to raise new equity to close the loan.” Meanwhile, the odds of a Republican sweep at the November election have decreased, which also bodes well for EVgo’s outlook. Gripping also pointed out other catalysts for the stock including updated financial guidance for an increased growth outlook. — Lisa Kailai Han 7:46 a.m.: JPMorgan upgrades AIG It’s time to buy shares of AIG , according to JPMorgan. Analyst Jimmy Bhullar upgraded the insurance giant to overweight from neutral. Though he trimmed his price target to $89 from $93, the new forecast still implies upside of 17.7%. Shares ticked 0.75% higher following the upgrade. Bhullar said he had been “reluctant to recommend the stock given concerns about dilution from the CRBG separation, optimistic consensus EPS forecasts, and relative valuation. However, consensus EPS forecasts have become more reasonable (and we believe overly conservative), while the stock’s relative valuation has improved following its recent underperformance.” “Our bullish stance reflects expected outsized EPS growth over the next few years, AIG’s lower exposure to risks facing commercial insurers, and high capital flexibility,” Bhullar said. Year to date, the stock is up nearly 12%. — Fred Imbert 7:26 a.m.: TD Cowen downgrades PepsiCo to hold from buy PepsiCo could be forced to contend with further market share losses going forward, according to TD Cowen. The financial firm downgraded the food and beverage stock to a hold rating from buy. Analyst Robert Moskow also lowered his price target to $183 from $190. Shares of PepsiCo closed Wednesday’s session at $172.54. The stock has risen less than 2% this year. Moskow noted that pricing in three of PepsiCo’s key segments — salty snacks, carbonated beverages and sports drinks — have risen 41% since 2020 versus a grocery store average of a 25% increase. “While we continue to view PEP as a top-tier CPG company, we believe that aggressive pricing in their three biggest U.S. categories over-extended their value equation to consumers and will compromise their near-term pricing power,” he wrote. “In salty snacks, we expect pricing to turn negative; in carbonated beverages, we expect continued volume pressure from price elasticity.” Moskow expects PepsiCo’s U.S. competitors to raise their prices next year, which would further erode the company’s share losses and volume declines. Meanwhile, the analyst also believes Frito-Lay will expand its price discounts, leading to muted growth next year. — Lisa Kailai Han 7:16 a.m.: Wolfe Research upgrades L3Harris Technologies to outperform Wolfe Research sees a turning point coming soon for L3Harris Technologies . Analyst Myles Walton upgraded the aerospace and defense stock to outperform rating from peer perform. Walton also set a price target of $300, approximately 24% higher than where shares closed on Wednesday. L3Harris Technologies stock is up 15% this year. While the company’s growth has lagged that of its peers, Walton has higher confidence in the company’s sales, earnings and free cash flow growth and sees convergence in the next year. Meanwhile, L3Harris’ margins are also ticking higher due to renewed cost-saving efforts. “The company reduced its headcount by 5% thus far in 2024, which along with ongoing facility consolidation and supply chain rationalization explain why they have more upside than most with respect to margin expansion,” Walton wrote. — Lisa Kailai Han 7:09 a.m.: Truist upgrades Nike to buy on the back of strategic turnaround Nike has a bright future ahead, according to Truist. The financial firm upgraded the athletic apparel stock to a buy rating from hold and raised its price target to $97 from $83. Shares of Nike are down 24% on the year but could rise nearly 18%, according to this updated forecast. Analyst Joseph Civello noted that Nike has been plagued with customer fatigue and stifled innovation in the past few years. While Civello was careful to point out that a turnaround process would be both long and uncertain, he’s more optimistic now than before. “With a team of company vets back at the helm, we think they’re moving in the right direction,” he wrote. “Although a fundamental recovery remains a long-term prospect, we think some NT wins (investing in more marketing, improving wholesale relationships, promoting ambassador Caitlin Clark, etc.) from the fresh team should be enough to show investors there are better times ahead.” Nike has also lost key market shares to competitors such as On Holding and Hoka, exacerbated by its exit from retailers. However, Civello believes that one of the new management team’s first strategic priorities will be to re-engage with these retail partners, which include Macy’s, Designer Shoe Warehouse and Foot Locker. A massive opportunity could also come from establishing a Nike storefront on Amazon. — Lisa Kailai Han 6:48 a.m.: Goldman Sachs trims Microsoft price target Goldman Sachs is still bullish shares of Microsoft , despite a minor price target adjustment. The bank reiterated its buy rating and lowered its price target for the tech titan to $500 from $515, but this updated forecast still implies that Microsoft could rally 20% from its current levels. The “Magnificent Seven” stock has risen 11% this year. Analyst Kash Rangan attributed this price target change to slightly lower free cash flow expectations. However, the analyst is still bullish Microsoft’s fundamentals and sees tailwinds for the stock’s earnings coming from growing AI demand and early AI investments. “As Azure capacity comes online and AI revenue continues to scale, we expect Microsoft to execute well against our expectations for 14% revenue growth … and EPS of $3.14,” he wrote. In fact, these catalysts and upcoming reacceleration should be strong enough to offset any losses that might result from OpenAI. “Though we are modeling $2-3bn in OpenAI losses for FY25/FY26, we see room for tailwinds to EPS from operating efficiencies as Microsoft’s strategic investments scale,” Rangan added. “While recognizing Microsoft trades at 29x CY25 P/E (a 34% premium to the S & P), we note that even during a peak investment year, Microsoft EPS growth is still 300bps faster than the S & P which we believe justifies the stock’s valuation.” — Lisa Kailai Han 6:24 a.m.: Bernstein downgrades PayPal, cites recent outperformance It’s time to rein in the enthusiasm for PayPal , according to Bernstein. Analyst Harshita Rawat downgraded the payments platform stock to market perform from outperform. However, she accompanied the move by lifting her price target to $80 from $75. Shares of PayPal are up 33% this year and closed at $81.65 on Wednesday. Rawat’s updated forecast sees the stock slipping 2% after its recent outperformance. “The stock path appears to be more uncertain from these levels due to the push/pull dynamics around intense competitive pressures on the cash-cow button on one hand, and tailwinds from buybacks/opex cuts and incrementalism (around monetization initiatives) on the other hand,” she wrote. Meanwhile, Venmo could lose momentum in the peer-to-peer payments vertical, with Cash App and Zelle on the rise. And while investors are enthusiastic around Fastlane, PayPal’s checkout solution for businesses, Rawat noted that its development will take multiple years to execute. The analyst added that lower rates could impair PayPal’s gross profit and earnings growth in the coming year. — Lisa Kailai Han 6:07 a.m.: RBC upgrades Medtronic on the back of ‘renewed sense of confidence’ It’s time to move off the sidelines when it comes to Medtronic , according to RBC Capital Markets. The bank upgraded shares of the medical technology stock to an outperform rating from sector perform and raised its price target to $105 from $98. This new forecast is 19% higher than where Medtronic stock closed on Wednesday. Shares of Medtronic have risen 7% in 2024. Analyst Shagun Singh noted the stock trades at a discount to peer, which he thinks longer makes sense given its recent improvements. “We have a renewed sense of confidence in the business fundamentals, and management’s ability to execute, which was lacking in the past,” the analyst said. “MDT is trading at the deepest discount to the S & P 500 at 6x versus 10-year historic average of 1x. We believe this is no longer justified and expect a re-rating in the stock as catalysts take hold e.g. margin expansion/EPS growth and product catalysts.” Singh added that Medtronic believes analysts have underappreciated most of its catalysts, including various product offerings and technologies. With this in mind, the analyst said that he was even more confident that Medtronic would execute on its three key themes for fiscal year 2025. These goals include delivering continued mid-single-digit growth at the top line, investing in high-priority growth and areas and restoring the company’s earnings power. — Lisa Kailai Han 5:50 a.m.: Barclays upgrades CVS, sees 24% upside Barclays sees significant upside ahead for shares of CVS . The bank upgraded the pharmaceutical stock to overweight from equal weight. Analyst Andrew Mok accompanied the rating change by lifting his price target to $82 from $63. CVS has slipped 16% this year, but Mok’s target implies that shares could rally a 24% from Wednesday’s close. CVS YTD mountain CVS year to date The analyst thinks that a “compelling margin recovery opportunity” exists for the stock due to a few catalysts, including early signs of a Medicare margin recovery. “CVS went three-for-three in important Medicare releases over the past two weeks (plan exits, supplemental benefits, and star scores), which is a positive first step toward a multi-year Medicare margin recovery to unlock significant value at Aetna,” he wrote. Mok added that most consensus estimates underappreciate the pace of this recovery, especially given the company’s significant cost-savings initiatives which could unlock around $2 billion in value. The analyst pointed out that CVS currently trades at a discount to peer Cigna. “We think the EPS baseline has stabilized, which sets the stage for earnings acceleration in its most valuable segment (Aetna),” he wrote. — Lisa Kailai Han 5:50 a.m.: JPMorgan downgrades Honeywell Don’t expect much from Honeywell in the near future, according to JPMorgan. Analyst Stephen Tusa downgraded the industrial giant to neutral from overweight. To be sure, he did raise his price target by $10 to $235, implying upside of nearly 10%. “We like the defensive growth profile of the company with extended visibility tied to the long cycle backlog and a renewed focus on growth under the new CEO, and we applaud action here, with a constructive top line outlook for ’25,” Tusa wrote. “However, our concern is that a refreshed focus on organic growth, which we expect to pay off somewhat in 2025, may not fall to the bottom line as expected, with a trade-off that is balanced against margins,” he added. “In addition, inorganically, we had thought the company had 3% upside from acquisition accretion in ’25 setting up for a beat, but with divestitures now taking center stage, it appears as though while portfolio management will likely mix the company to higher quality metrics, the dilution is a cost that breaks the near term consensus earnings curve,” Tusa said. The Dow Jones Industrial Average member fell 0.8% in the premarket after the downgrade. Year to date, it’s up just 2%. HON YTD mountain HON in 2024 — Fred Imbert
