By Davit Kirakosyan | Investing.com
Here is your Pro Recap of the biggest analyst picks and cuts you may have missed today: upgrades at Forward Air, Zimmer Biomet, and UGI, and downgrades at CrowdStrike and L3Harris Technologies.
CrowdStrike downgraded at Morgan Stanley ahead of Q2.
Crowdstrike (NASDAQ:CRWD) shares fell more than 2% premarket today after Morgan Stanley downgraded the company to Equalweight from Overweight and cut its price target to $167.00 from $178.00 ahead of Q2/24 earnings announcement on Wednesday.
Difficult Numbers Set Up Into Q2 and 2H: Net New ARR (NNARR) is key metric. We expect FQ2 NNARR to come barely inline with consensus $192MM (-12% YoY) and management's implied guidance of $193-$194MM (-11% YoY), as our checks through June were largely stable.
The consensus and management's guidance of low-30% growth in total ARR for fiscal 2024 assumes that there will be a resurgence in NNARR during the second half of the year.
Morgan Stanley believes that the consensus forecast for NNARR is overly optimistic at 6% year-over-year growth in Q3 and sees a downside to a 12% growth estimate in Q4.
Forward Air raised to Peerperform 'after big reset'.
Since the announcement of the Omni Logistics acquisition on August 10, Forward Air shares have dropped by around 35%. “So after the big reset to the stock and with signs of a bottom with the 13% bounce of the bottom, we're moving back to the sidelines,” mentioned Wolfe Research.
3 more rating changes.
Zimmer Biomet (NYSE:ZBH) shares rose more than 1% premarket today after BTIG upgraded the company to Buy from Neutral with a price target of $139.00.
While our upgrade is partly rooted in valuation, we think the sell-off following the CEO transition was a little overdone. This isn't 2017 and ZBH isn't the same company it was back when Bryan Hanson took over. Ivan Tornos takes over a much healthier ZBH at a time when the orthopedic market is strong and ZBH's balance sheet is healthy.
Bernstein downgraded L3Harris Technologies (NYSE:LHX) to Market Perform from Outperform and cut its price target to $210.00 from $239.00.
The firm still expects robust top-line growth for L3Harris, supported by growing backlogs, but mentioned that the problem remains on margins with supply chain issues, inflation on fixed-price contracts, and execution.
UGI (NYSE:UGI) shares rose more than 3% premarket today after Wells Fargo upgraded the company to Overweight from Equal Weight with a price target of $27.00 (from $28.00).