In this article, we discuss analysts’ revised recommendations for 5 companies. If you want to see some more companies that received ratings-change from analysts, go directly to Analysts Just Revised Their Ratings for These 10 Stocks.
5. Albemarle Corporation (NYSE:ALB)
Number of Hedge Fund Holders: 44
Shares of Albemarle Corporation (NYSE:ALB) rose nearly four percent on Wednesday, July 20, 2022, after KeyBanc upgraded the Charlotte-based specialty chemicals company from “Underweight” to “Sector Weight.”
KeyBanc analyst Aleksey Yefremov expects U.S. chemical stocks, including Albemarle Corporation (NYSE:ALB), to deliver solid results for the second quarter. He also expects Albemarle Corporation (NYSE:ALB) to benefit from higher lithium prices.
Albemarle Corporation (NYSE:ALB) is a leading provider of lithium, a critical component in EV batteries. The rapid adoption of EVs around the world has raised the demand for battery components, enabling lithium producers to capitalize on the solid demand.
4. Chevron Corporation (NYSE:CVX)
Number of Hedge Fund Holders: 53
Shares of Chevron Corporation (NYSE:CVX) closed higher on Wednesday, July 20, 2022, after HSBC raised its ratings for the California-based energy giant from “Hold” to “Buy.” HSBC analyst Gordon Gray pointed toward a sharp drop in the company’s share price. Gray added that Chevron Corporation (NYSE:CVX) looks attractive at current valuations.
Separately, investment management firm Diamond Hill Capital also talked about Chevron Corporation (NYSE:CVX) in its first-quarter 2022 investor letter. Here’s what the firm said:
“Other top contributors in Q1 included multinational energy company Chevron Corp. (NYSE:CVX). The company benefited from increased energy demand as COVID-related economic restrictions eased in tandem with concerns regarding supply interruptions related to Russia’s invasion of Ukraine.”
3. Block, Inc. (NYSE:SQ)
Number of Hedge Fund Holders: 84
Macquarie downgraded Block, Inc. (NYSE:SQ) from “Outperform” to “Neutral” on Tuesday, July 19, 2022. Macquarie analyst Paul Golding thinks that the company’s operating costs would likely weigh on its adjusted EBITDA in the coming quarter. He also cut his price target for Block, Inc. (NYSE:SQ) from $140 per share to $64 per share.
Earlier this year, Block, Inc. (NYSE:SQ) appeared in the first-quarter 2022 investor letter of investment management firm Farrer Wealth Advisors. Here’s what the firm said:
“Block (formerly Square): We ‘adopted’ Block’s stock after the company bought Afterpay, which we were investors in. We had been trimming the Afterpay position throughout 2021 and trimmed again after the acquisition, so the position was quite small. We held onto that small portion, as we did think the acquisition made sense and were excited to see the two companies integrate and for Block to create a closed loop network between merchants and consumers. However, the market punished most highly valued tech stocks over the last months, and we saw the position move against us by over 50%. We are firm believers that when a stock goes against you by 50%+, you need to do something about it. Either trim/sell and reinvest or buy more. In the case of Block, the original reason for holding was to see how the acquisition and integration with Afterpay panned out. The market did not give us the time to see this play out, thus we were not comfortable adding more to the position. Further for the stock to recover to our purchase price, we felt the company’s valuation would need to command a future exit multiple that the market would be unlikely to pay in this environment. Given this, we exited the remainder of the position.”
2. Alibaba Group Holding Limited (NYSE:BABA)
Number of Hedge Fund Holders: 100
Alibaba Group Holding Limited (NYSE:BABA) received an upgrade from Bernstein on Wednesday, July 20, 2022. The research firm upgraded the Chinese e-commerce giant from “Market Perform” to “Outperform.”
Bernstein analyst Robin Zhu thinks that Alibaba’s incremental gross merchandise value (GMV) share would likely expand in the coming quarters amid easier year-over-year comparisons and softer macro issues. Zhu also lifted his price target for Alibaba Group Holding Limited (NYSE:BABA) from $115 per share to $130 per share.
Separately, Memphis-based Longleaf Partners Fund mentioned Alibaba Group Holding Limited (NYSE:BABA) in its first-quarter 2022 investor letter, stating:
“We took advantage of price volatility to add to three of our most heavily discounted European businesses, including new purchases in 4Q 2021 and we reinitiated a position in Alibaba (NYSE:BABA), as the shares became even more heavily discounted amid broad China volatility in the period.”
1. Netflix, Inc. (NASDAQ:NFLX)
Number of Hedge Fund Holders: 109
Shares of Netflix, Inc. (NASDAQ:NFLX) jumped over seven percent on Wednesday, July 20, 2022, after Stifel upgraded the video streaming giant from “Hold” to “Buy.” The upgrade came a day after the company released its second-quarter results.
Stifel analyst Scott Devitt referred to Netflix’s growth plans, including implementing a password-sharing fee and launching an ad-supported streaming tier. Devitt also lifted his price target for Netflix, Inc. (NASDAQ:NFLX) from $240 per share to $250 per share.
Netflix, Inc. (NASDAQ:NFLX) recently announced mixed financial results for the second quarter. The company reported earnings of $3.20 per share, beating the consensus of $2.94 per share. However, its quarterly revenue of $7.97 billion missed analysts’ average estimate of $8.035 billion. On the positive side, the company said it lost 970,000 subscribers during the second quarter, well below analysts’ projected loss of 2 million subscribers.
You can also take a peek at 10 Best Electric Utility Stocks To Invest In and Jim Cramer Recommends These 10 Stocks For Recession.
