Analysts’ upgrades for Friday, January 27th:
Agios Pharmaceuticals (NASDAQ:AGIO) was upgraded by analysts at Zacks Investment Research from a sell rating to a hold rating. According to Zacks, “Agios is a development-stage biopharmaceutical company focused on the development of treatments for cancer and rare genetic metabolic disorders. Being a development-stage company, Agios depends heavily on Celgene for revenues, which it earns in the form of collaboration revenues. The collaboration with Celgene is encouraging as it provides Agios funds in the form of upfront, regulatory and commercial milestone payments plus royalties. However, company also depends on Celgene for two of its pipeline candidates – enasidenib and AG-881. Agios’ progress with its pipeline has been impressive. Notably, most of the company's pipeline candidates are in mid and early stages of development and thus several years from entering the market, if at all. Stiff competition is another threat. Shares of the company have underperformed the Medical-Products industry in 2016. The company’s estimates have been going down lately ahead of its Q4 earning.”
American Capital Agency Corp. (NASDAQ:AGNC) was upgraded by analysts at Zacks Investment Research from a hold rating to a buy rating. The firm currently has $21.00 price target on the stock. According to Zacks, “AGNC Investment is slated to report fourth quarter 2016 results on Feb 1. The shares of the company outperformed the Zacks categorized REIT-Mortgage Trust industry in the past one year. Moreover, its estimates for 2016 and 2017 net spread and dollar roll income per share also moved up over the past 60 days. The company’s efficient cost structure and portfolio repositioning efforts for hedging interest rate uncertainty augur well. Also, adequate financial flexibility and share buybacks are encouraging. Further, the acquisition of its external manager last July has substantially lowered its operating costs. However, volatility in the market and issues regarding global economy are concerns.”
BlackBerry Limited (NASDAQ:BBRY) (TSE:BB) was upgraded by analysts at Zacks Investment Research from a hold rating to a buy rating. Zacks Investment Research currently has $8.25 target price on the stock. According to Zacks, “We are positive on BlackBerry's decision to end all internal hardware development and outsource the same to its partners.The company reported narrower-than-expected loss in the third quarter of fiscal 2017. The company's new guidance with respect to the bottom line for fiscal 2017 is also encouraging. The company expects to return to profit in fiscal 2017. The previous outlook was in the range of breakeven results to a loss of $0.05 per share. Recently, the company entered into a deal with Chinese handset manufacturer TCL Communications to produce BlackBerry handsets for certain countries across the globe. The deal with Giuliani Partners to combat cyber threats is also encouraging. On the back of these positives, shares of BlackBerry have outperperformed the broader industry over the last three months. However, the company continues to grapple with headwinds like adverse foreign currency movements.”
Celestica (NYSE:CLS) (TSE:CLS) was upgraded by analysts at Macquarie from a neutral rating to an outperform rating.
Canadian National Railway Company (NYSE:CNI) (TSE:CNR) was upgraded by analysts at Zacks Investment Research from a hold rating to a buy rating. Zacks Investment Research currently has $79.00 target price on the stock. According to Zacks, “Although shares of Canadian National have underperformed the broader industry over the past three months, the company received good news lately when it reported better than expected earnings in the fourth quarter of 2016. The bottom line also expanded significantly on a year-over-year basis. Earnings benefited from efficient expense management. However, Canadian National continued to grapple with top line-related woes as evidenced by its lower-than-expected revenues. The top line, however, expanded 1% on a year-over-year basis. We are also impressed by the company's decision to hike its quarterly cash dividend by 10%.”
Diana Shipping inc. (NYSE:DSX) was upgraded by analysts at Nordea Equity Research from a hold rating to a buy rating.
Ericsson (NASDAQ:ERIC) was upgraded by analysts at Zacks Investment Research from a sell rating to a hold rating. According to Zacks, “Ericsson’s fourth-quarter 2016 earnings missed the Zacks Consensus Estimate by 36.4% and were down 75.2% from the year-ago tally, largely on account of weak product demand and revenue performance. Over the past six months, Ericsson’s shares recorded a negative average return, far worse than the Zacks categorized Wireless Equipment industry’s average negative. Soft emerging market conditions, completion of major projects and adverse industry trends added to the woes. However, on the positive side, the company has prioritized three areas of growth, namely core business, targeted investments and cost & efficiency. Ericsson’s recent partnership with Cisco is showing promise and is expected to boost its product lineup and drive sales growth. Also, steady pace of LTE deployments in Southeast Asia and Oceania is proving conducive to the company’s growth.”
Freeport-McMoran (NYSE:FCX) was upgraded by analysts at TheStreet to a hold rating.
IDEXX Laboratories (NASDAQ:IDXX) was upgraded by analysts at Zacks Investment Research from a sell rating to a hold rating. According to Zacks, “Ahead of fourth quarter report, IDEXX is trading above the Zacks categorized Medical Instruments industry in the last three months. Its latest entry in the S&P 500 benchmark also buoys optimism. However the company posted mixed results in the past third quarter with revenues missing the Zacks Consensus Estimate. The company’s raised EPS guidance for 2016 indicates a bullish trend going forward. Further, the company’s trend of consistent share buybacks reflects its strong free cash flow reserve. The continued strong instrument placements, global lab momentum reflecting leverage of expanded commercial capability as well as strong test menu expansion remain IDEXX’s key prospects. On the flip side, IDEXX's high dependence on third-party distributors and intense competition continue to pose threats. Moreover foreign currency fluctuations are expected to consistently hurt IDEXX’s future growth.”
Itau Unibanco Banco Holding SA (NYSE:ITUB) was upgraded by analysts at Zacks Investment Research from a sell rating to a hold rating. According to Zacks, “Itau Unibanco shares have outperformed significantly the Zacks categorized Foreign Banks industry, over the past one year. The company’s growth prospects look encouraging as it remains focused on building strategies to expand inorganically. Recently, Itau Unibanco completed the acquisition of 40% equity stake in Itau BMG Consignado. Further, it has been diversifying its loan composition with focus on origination of products with lower risks and more guarantees. However, rising operational risk with management's expectation of non-interest expenses to increase in the range of 2%–5% in 2016 and strict regulations remain concerns.”
Meritor (NYSE:MTOR) was upgraded by analysts at Zacks Investment Research from a hold rating to a strong-buy rating. They currently have $17.00 target price on the stock. According to Zacks, “Meritor has outperformed the Zacks-categorized Auto/Truck-Original Equipment industry over a year. The share price benefited from better-than-expected results in fiscal 2016, benefits from new business and focus on M2019 plan. The company will further reduce its debt level per this plan. The company is also looking to introduce 20 new products over the next 3 years, as per the plan. The primary objectives of the plan are to grow revenues by 20% and increase earnings per share by $1.25. Meritor is also aiming for new business wins to achieve the revenue growth target in this time frame.”
Ross Stores (NASDAQ:ROST) was upgraded by analysts at Zacks Investment Research from a hold rating to a buy rating. Zacks Investment Research currently has $73.00 target price on the stock. According to Zacks, “Ross Stores has outperformed the broader industry in the past one year, given its positive record of earnings surprises in recent quarters. Further, the company raised its earnings forecast for fiscal 2016 on the back of solid year-to-date results. The company has been gaining from the favorable response of value-focused customers to its extensive collection of brand bargains and solid cost controls. Further, the company’s solid financial status, ongoing merchandise initiatives and consistent focus on store expansion bode well. We applaud the company’s merchandise organization initiatives as well as its ability to run the business with leaner inventory levels. However, challenges related to strong comparisons, amid macroeconomic uncertainty and a volatile retail landscape are expected to hurt fourth quarter results. Estimates have been stable lately ahead of the company's fourth quarter earnings release.”
Silicon Motion Technology Corporation (NASDAQ:SIMO) was upgraded by analysts at Zacks Investment Research from a sell rating to a hold rating. According to Zacks, “Silicon Motion continues to benefit from strategic product launches. The company reported year-over-year earnings growth based on strong revenues in the recently concluded fourth-quarter 2016. However, the company's guidance was disappointing as revenues are expected to decline sequentially due to soft client SSD Controller sales, flat eMMC controller sales and declining SSD solution sales. However, anticipated improvement in in NAND flash supply in second-half 2017 is positive. Moreover, continuing investments on product development will drive growth. However, we note that the company has underperformed the broader market in the last 12 months. Moreover, decline in the NAND Flash market could hamper card and USB flash drive sales going ahead.”
Teradyne (NYSE:TER) was upgraded by analysts at Zacks Investment Research from a sell rating to a hold rating. According to Zacks, “Teradyne is a leading provider of automated test equipment. Over the last one year, the stock has underperformed the Zacks Electronics – Testing Equipment industry. However, Teradyne’s fourth quarter results exceeded the Zacks Consensus Estimate. A recovery in the core semiconductor business (processors, MCUs and power management), long-term opportunities in the high-growth wireless test market, growing memory market exposure, strong product lineup, lean cost structure and strong balance sheet are positives. Given the popularity of its products, the Universal Robots acquisition and the continuous design win momentum; the company is optimistic long-term prospects. However, weakness in the wireless test market could be a concern in the near term.”
Domtar Corporation (NYSE:UFS) (TSE:UFS) was upgraded by analysts at Bank of America Corp from a neutral rating to a buy rating.