My top 10 things to watch Friday, June 16
1. Cava (CAVA) success: doubled on its first day of trading. Adding another 3% early Friday. The well-received Mediterranean restaurant chain will open the IPO floodgates, as predicted, here. In food and beverage, the Club owns Starbucks (SBUX), and we looked at how the coffee giant could boost profits by putting AI chatbots at its drive-thru windows.
2. The Dow, the S&P 500 and the Nasdaq are set for a slightly higher open. As of Thursday’s close, the S&P 500 and Nasdaq were at their highest levels since April 2022. The Dow has more work to do to catch up. So far the 30-stock average has gained 1.6% this week. The S&P 500 and the Nasdaq this week have gained roughly 3% and 4%, respectively. Wall Street largely took Wednesday’s “hawkish pause” in Fed interest rate hikes in stride.
3. Adobe (ADBE) gets an avalanche of price target boosts from Wall Street research firms after the software giant behind Photoshop, and so many more creative suites, delivered a solid quarterly beat and guidance raise. Shares of Adobe have really taken off since partnering with Club name Nvidia (NVDA) in late March to develop generative AI models for creators and marketers.
4. Morgan Stanley research analysts replace Club name Advanced Micro Devices (AMD) with Nvidia as their Top Pick in semiconductors. The firm increased NVDA price target to $500 per share from $400. Keeps overweight (buy) rating. Demand environment for AI training keeps picking up. Saw it with Adobe. But Morgan Stanley still sees AMD as a buy, boosting its PT to $138 from $97.
6. Club holding Meta Platforms (META) gets a price target hike to $320 per share from $300 at Bank of America, which also keeps buy rating. The analysts point to Meta’s accelerating growth compared to rivals.
7. Wedbush increases price target on Club name Palo Alto Networks (PANW) to $290 per share from $225. Keeps outperform (buy) rating. The analysts see cloud cybersecurity growth as a major catalyst.
8. Bank of America raised price target on Club stock Caterpillar (CAT) to $283 from $250. BofA analysts keep buy rating ahead of their meeting next week with company officials including CEO Jim Umpleby. In the Club’s June Monthly Meeting this week, we examined our four industrial stocks, including CAT. They’ve all quietly come to life.
9. Price target increases for Lennar (LEN), including UBS going to $150 per share from $127 and keeping buy rating. Cash flow and low level of debt. Ready to build more homes but did fewer in 2023 so far versus last year because of fear of recession.
10. SoFi (SOFI) downgraded to neutral from buy-equivalent at both Bank of America and Piper Sandler. But analysts from both firms boost their price target. Sofi shares double since we talked to CEO Anthony Noto back at Santa Barbara about three weeks ago.
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