Thursday’s biggest analyst calls include Micron and Apple
Wall Street analysts issued a series of significant rating changes on Thursday, headlined by Bank of America’s upgrade of Nomura to buy and Morgan Stanley’s reassessment of Qualcomm and Affirm. While firms like Rosenblatt and Benchmark initiated coverage on growth-focused tech and financial stocks, others signaled caution, with Barclays maintaining an underweight stance on Apple citing regulatory risks and an undefined AI strategy.
Did You Know? Citi raised its price target for SanDisk to $2,500 per share from $2,025, positioning the stock for potential movement ahead of the company’s August investor day.
Shifts in Technology and AI Valuations
Analysts are recalibrating their outlooks on major technology players as AI-driven demand continues to influence market sentiment. Goldman Sachs initiated coverage of Intel with a neutral rating and a $150 price target, noting the company could benefit from rising server demand and its foundry business. Conversely, Morgan Stanley upgraded Qualcomm to equal weight, admitting its previous skepticism was misplaced as a new trillion-dollar data center market creates fresh opportunities for the firm.
The sentiment toward AI-related infrastructure remains mixed. Rosenblatt initiated CoreWeave as a buy, projecting an upside to $250, while BTIG initiated Boost Run as a buy, highlighting the firm’s status as a preferred cloud partner of Nvidia. Meanwhile, Benchmark initiated JFrog as a buy with a $100 price target, citing the company’s structural position in AI-driven software development.
Financial and Industrial Sector Adjustments
In the financial and industrial sectors, Bank of America upgraded Nomura to buy from neutral, citing improved earnings and return on equity. Similarly, Benchmark initiated Pinnacle Financial Partners as a buy, suggesting that the company’s current discounted valuation relative to peers offers potential upside as management executes its strategy over the coming quarters. Citi also upgraded Banco Santander Chile to buy, projecting double-digit income growth.
Expert Insight: The divergence in analyst sentiment—ranging from Morgan Stanley’s pivot on Qualcomm to Barclays’ continued skepticism of Apple—highlights a broader tension on Wall Street. Investors are currently weighing traditional fundamental metrics against the narrative-driven potential of emerging AI technologies, creating a market where individual execution and specific sector catalysts are becoming the primary drivers of stock performance.
Outlook for Consumer and Industrial Goods
Barclays upgraded Keurig Dr Pepper to overweight, noting that the company is beginning to see a re-rating as transaction uncertainty wanes. In the rail sector, Evercore ISI upgraded Canadian National to outperform, suggesting the company is positioned for a material beat and raise ahead of 2Q earnings. Jefferies also upgraded Xylem to buy, as the water company tracks toward its margin expansion targets ahead of schedule.
Not all outlooks were positive. Morgan Stanley downgraded Affirm to equal weight, citing valuation concerns, while Barclays reiterated Tesla as equal weight, noting that for the electric vehicle manufacturer, fundamentals like 2Q deliveries and margins are increasingly an “afterthought” compared to narratives surrounding Robotaxi and AI.
Frequently Asked Questions
Why did Morgan Stanley downgrade Affirm?
Morgan Stanley downgraded the stock to equal weight primarily due to valuation, stating that the market now fully appreciates the durability of the company’s growth, funding, and credit.
What is driving the upgrade for Nomura?
Bank of America upgraded Nomura to buy because the gap to its price objective has widened, supported by recent improvements in earnings and return on equity.
Why does Barclays maintain an underweight rating on Apple?
Barclays cites an uncertain growth backdrop, regulatory risks in the company’s services segment, an undefined AI strategy, and a premium valuation as reasons for the rating.
How will these varying analyst perspectives on AI-driven growth influence your approach to sector-specific investments in the coming quarter?