The S&P500 (SP500) closed in the green on Friday, after investors digested quarterly results from major banks and data showing that consumer prices cooled in June, reinforcing bets on a rate cut in September.
During the week, the Nasdaq (COMP:IND) lost 0.7%, while the Dow (DJI) advanced by 1%.
Analysts have both upgraded and downgraded Wall Street. Here are some of the top predictions for the week:
Apple in the spotlight after a series of analyst comments during the week
Needham raised his price target to $260 from $220 and reiterated his Buy rating, noting that Apple (NASDAQ:AAPL) is spending its capital on share buybacks rather than generative ai infrastructure.
However, Needham analyst Laura Martin expressed concern that Apple's revenue growth rate could be at risk over the next three years and suggested Apple build an advertising business similar to amazon's.
Piper Sandler also raised its price target on the tech giant to $225 from $190.
“In our view, the enthusiasm is justified as ai could be a game-changer for upgrades,” said Piper analyst Matt Farrell. Farrell noted that much of the recent good news is already “priced in.”
Meanwhile, Wedbush analyst Dan Ives, who has an Outperform rating and a $275 price target on Apple, said the iPhone is seeing more signs of stabilization in several markets, and the brokerage believes June will be the last quarter of negative growth for China with a trend reversal beginning in the September quarter.
Shares fell slightly over the week. Overall, they gained more than 18% since the beginning of the year.
Tesla remained in the spotlight this week after UBS downgrade
Tesla (NASDAQ:TSLA) was downgraded from Neutral to Sell by UBS due to valuation concerns.
“While TSLA is investing heavily in ai and the technology is advancing, the investment is expensive, the pace of improvement can slow and the payoff is long-term,” he warned. “If market enthusiasm for ai wanes, this may impact TSLA's multiple,” said analyst Joseph Spak, who assigned a $197 price target.
The electric vehicle giant fell more than 8% on Thursday on a report of a possible delay to its Aug. 8 robotaxi event. The stock had gained in 11 consecutive trading sessions before the drop.
Analysts offer clues on banks ahead of earnings release
Analysts posted a lot of commentary throughout the week on what to expect from banks, as the big banks grabbed headlines with their first quarter results on Friday.
Wolfe downgraded JPMorgan Chase (New York Stock Exchange: JPM) from Outperform to Peer Perform, adding that “the valuation looks complete.” The brokerage said the banking giant is more exposed to a decline in NII due to higher leverage at the short end compared to its peers.
The investment firm also downgraded Raymond James Financial's rating (New York Stock Exchange: RJF) from Outperform to Peer Perform, adding that it expects EPS growth to decelerate relative to its peers.
from KeyCorp (New York Stock Exchange: KEY) was downgraded by UBS from Buy to Neutral, arguing that lower capital positioning could inhibit the regional bank's growth. UBS also lowered the PT by $1 to $15.
Meanwhile, Piper Sandler analyst R. Scott Siefers upgraded Bank of America's rating (New York Stock Exchange:BAC) from Underweight to Neutral and said it expects Q2 NII to fall to ~$13.9 billion and then jump to $14.5 billion-$14.6 billion for Q4 this year.
Jefferies is uncertain about Darden's near-term growth
Jefferies said weak traffic trends for Darden Restaurants (New York Stock Exchange:DRI) The Olive Garden brand could continue to struggle, downgrading the restaurant chain from “hold” to “underperform.”
Jefferies also lowered its price target to $124 from $154, citing risk to growth in the near term.
Shares have lost nearly 15% so far this year.
Microchip technology and ON Semiconductor downgraded on valuation concerns
In semiconductors (NASDAQ:ON) and Microchip technology (NASDAQ:MCHP) received a rating downgrade from Morgan Stanley due to issues related to the automotive industry and valuation concerns.
Analyst Joseph Moore said Microchip's valuation reflects “elevated expectations” and lowered his rating to “equal weight” from “overweight,” though he slightly revised his price target to $100 from $102 previously.
Similarly, Moore downgraded ON Semiconductor from Equal-Weight to Underweight and cut his price target to $65 from $70, adding that there is “limited room” for multiple expansion.
The competitive environment for music streaming services worries Redburn; Jefferies has a different take
The competitive environment for the music streaming industry and structural challenges caused analysts at Redburn Atlantic to downgrade Spotify's rating (New York Stock Exchange: SPOT) and Warner Music Group (NASDAQ:WMG) sell.
The equity research firm also mentioned Universal Music Group (OTCPK:UMGNF), saying the company is “most exposed” to industry risks.
Meanwhile, Spotify is Jefferies' top pick among the three music streaming services and the brokerage expects continued price increases, bundling and gross margin expansion for the company.
Jefferies rates all three companies “Buy.” Analysts view the current entry point for Warner Music Group stock as attractive, while Universal is considered “better positioned for the long term” due to its experienced management team and superior artist roster, which includes Taylor Swift, The Weeknd and Rihanna, among others.
Microsoft gets PT boost ahead of quarterly results
microsoft (NASDAQ: MSFT) shared some of the spotlight this week as BMO Capital Markets analyst Brian Pitz raised PT to $500 from $465 on the tech giant ahead of quarterly results due to rising expectations for its cloud business.
Earlier this week, Argus also raised its price target for Microsoft, citing its investments in GenAI both internally and externally.
Argus analyst Joseph Bonner added that Microsoft is seen as one of the few tech companies that investors consider a “safe haven” in times of uncertainty, given its diversified assets.
In addition to the companies mentioned above, there were other analyst actions during the week, including Carvanawhich Needham upgraded from Hold to Buy, calling it a secular growth story with cyclical recovery momentum.
UBS and Wolfe Research raised their PT Nvidia (NASDAQ:NVDA), noting that recent checks indicate demand for its upcoming Blackwell line is “extremely strong.”
Analysts at Benchmark also raised the PT by more than 25% on Nvidia shares and reiterated their Buy rating, saying demand for its high-tech hardware that powers the ai phenomenon shows no signs of slowing down.
Jefferies called Take-Two Interactive Software (NASDAQ:TTWO) its top pick in interactive entertainment and said the video game maker has the “most visible path to its many launch catalysts,” most importantly GTAVI.
Jefferies analyst James Heaney took over coverage of Electronic arts (NASDAQ:EA) on Buy, citing its strong pipeline. It also took on coverage of Roblox (New York Stock Exchange:RBLX) on hold.
