In this article, we will discuss the 10 stocks whose price targets were recently trimmed by analysts.
On Tuesday, US stock futures remained stable, reflecting investor optimism following a significant rally in the technology sector on Wall Street, which drove the broader market to a new all-time high. This latest surge marks the 30th record peak for the major US benchmark index this year, defying concerns about market breadth and the possibility of prolonged high US interest rates. Across the Atlantic, European equities experienced a robust rebound, reversing previous losses. Market analysts from M&G are suggesting that the current risks in France could present a strategic buying opportunity for investors, particularly those looking to capitalize on temporary market dips.
In the commodities market, Treasury yields held steady, indicating a cautious stance among investors amidst the mixed economic signals. Meanwhile, crude oil prices experienced a slight decline, whereas copper prices saw a significant increase, reflecting varying demand dynamics across different sectors. Goldman Sachs economists have pointed out that the US labor market might be approaching a critical juncture. Jan Hatzius from Goldman emphasized that any further decrease in labor demand could lead to a reduction in job numbers, not just a decline in job openings. This concern is underscored by recent data showing healthy nonfarm payrolls but rising initial and continuing jobless claims. Philadelphia Fed President Patrick Harker echoed this sentiment, suggesting that the Federal Reserve might consider either two interest rate cuts or none this year, depending on future economic data.
Adding to the financial landscape, a highly reliable technical trading strategy has issued a sell signal for long-term Treasury securities. This strategy, which has maintained a perfect trading record this year, was triggered after BlackRock’s bond exchange-traded fund tracking long-term Treasuries surged last Friday. The fund’s performance breached what is known as the “trading envelope,” indicating overbought conditions. As a result, the strategy suggests that traders should sell these securities when they are overbought and buy them when they are oversold.
The European Union, despite not matching the economic scale of its counterparts in the U.S. and China, aims to strategically challenge them, according to Margrethe Vestager, the bloc’s competition chief. Vestager emphasized in an interview with CNBC on Tuesday that the EU has significantly improved its ability to defend against unfair trade practices. She highlighted recent moves, including the imposition of higher tariffs on Chinese electric vehicle imports due to findings of substantial unfair subsidies benefiting Chinese manufacturers, potentially undercutting European producers. Vestager stressed that the EU’s approach isn’t about outspending its rivals but rather strategically allocating resources. She acknowledged that while the EU cannot match the financial clout of China or the U.S., it can invest strategically in areas of common European interest, such as hydrogen, electric batteries, microelectronics, cloud computing, and healthcare. She pointed to a 100 billion euro fund dedicated to advancing these cutting-edge technologies, aiming to leverage public funds to attract private capital where market forces alone might fall short. Amid escalating trade tensions globally, particularly between the U.S. and China, Vestager reiterated the EU’s careful stance, seeking to maintain balanced relations with both economic giants while safeguarding its own interests and alliances. She emphasized that the EU’s investments in technology and sustainability are not mere imitations of its competitors’ strategies but rather tailored to Europe’s unique needs and strengths in the global marketplace. Vestager concluded by urging a focus on the EU’s agenda rather than comparisons with other regions, asserting that the EU’s approach aims to be effective and sustainable in achieving its economic and technological goals.
China’s recent property support measures have successfully stimulated sales in its major cities, but smaller regions continue to face significant challenges, indicating a prolonged downturn for much of the national real estate market. According to Reuters, on May 17, China lowered mortgage rates and downpayment requirements and directed local governments to purchase unsold apartments to convert them into social housing. This initiative has led to numerous cities easing their housing policies.
Data from real estate research firms and interviews with agents reveal that these measures have had a mixed impact. While they have revived demand in cities like Beijing and Shanghai, smaller cities have seen limited improvement. Reports of home price declines further underscore concerns that the property sector’s troubles may persist, especially in smaller cities burdened with a higher supply of unsold properties. This excess inventory is keeping buyer sentiment low, prompting calls for additional support from policymakers. Data from the China Index Academy show that the average daily transactions of second-hand homes in Shanghai between May 18 and June 5 were 27.7% higher than in April, and in Beijing, they increased by 8.1%. Meanwhile, new home transactions in these cities declined slightly. Agents reported a surge in inquiries and home viewings, particularly in Shanghai, where one agent noted a tripling of inquiries following a downpayment reduction. Despite these signs of activity in major cities, smaller cities continue to struggle. Jiaozhou, a city with under a million residents, has attempted to stimulate demand by allowing buyers to split downpayments into two installments, but this has had little impact. In Changsha, authorities have urged developers to offer full refunds on deposits if buyers cancel their purchases, hoping to boost buyer confidence. However, local agents report that demand remains weak, with many customers skeptical about the effectiveness of the new policies. Goldman analysts predict that additional easing measures are likely in the coming months, but they caution that these measures might only lead to a slow, L-shaped recovery in the sector over the coming years.
Wall Street Analysts Just Trimmed Price Targets for These 10 Stocks
In this article we listed 10 companies whose price targets were cut by analysts and ranked them by the change in their market prices. Negative changes signal that the market participants agree with the analysts’ assessment.
10. Jabil Inc. (NYSE:JBL)
Price Reaction after the Price Target Cut: +5.00(+4.18%)
J.P. Morgan adjusted Jabil Inc. (NYSE:JBL) price target from $155 to $145 while reiterating an “overweight” rating on June 17. This adjustment came alongside a positive market response, with Jabil Inc. (NYSE:JBL) stock price increasing by 4.18% following the announcement. Jabil Inc. (NYSE:JBL) is known for its extensive expertise in manufacturing, including electronics manufacturing services and solutions for various industries, such as healthcare, aerospace, automotive, and consumer electronics. The company is recognized for its innovation and supply chain management capabilities. Jabil Inc. (NYSE: JBL) recently underwent significant leadership changes following an internal investigation into corporate policies. The company has appointed Michael Dastoor as its new Chief Executive Officer, succeeding Kenneth Wilson, who has departed from both the CEO position and Jabil’s Board of Directors. Concurrently, Gregory Hebard has been named Chief Financial Officer, leveraging his extensive financial leadership experience since joining Jabil in 2009. Mark Mondello, Executive Chairman of Jabil Inc. (NYSE:JBL) Board, expressed confidence in Dastoor’s capabilities and deep understanding of the company’s operations and culture. Dastoor, who has been with Jabil for more than twenty years and previously served as CFO since 2018, affirmed his commitment to driving growth and delivering value to Jabil’s stakeholders. The company clarified that the leadership changes and internal investigation do not impact its financial reporting integrity. Looking forward, Jabil Inc. (NYSE:JBL) anticipates releasing its third-quarter fiscal year 2024 financial results on June 20 before the market opens. This announcement is expected to provide further insights into the company’s performance amid its leadership transition and ongoing strategic initiatives.
Artisan Mid Cap Fund stated the following regarding Jabil Inc. (NYSE:JBL) in its fourth quarter 2023 investor letter:
“Along with DexCom, notable adds in the quarter included Quanta Services and Jabil Inc. (NYSE:JBL). Jabil provides outsourced manufacturing services to a diverse set of end markets and customers. For two decades, Jabil focused on manufacturing to customer-specified blueprints, which inherently carried low margins (2%–3%), a problem further exacerbated by Asian competition. However, in 2017, Jabil commenced a strategic pivot to focus on manufacturing high-growth, low-volume and high-value products in areas such as health care, industrial, automotive, cloud and 5G infrastructure. We believe moving away from more cyclical consumer electronics markets toward secular growth areas, such as EVs and medical devices, will lead to both faster growth and higher margins. Like other electronic components providers, Jabil saw slowing demand late in the year and lowered its fiscal 2024 outlook as a result. However, consistent with our thesis that Jabil has shifted its business mix toward more profitable, higher growth end markets, the company’s earnings and cash flow outlook remains relatively strong despite the cyclical pressures. Furthermore, the company sold its smartphone manufacturing business late in the quarter, which removes a low-growth, low-margin legacy exposure, further shifting its business mix in the right direction. We used the stock’s underperformance to increase our GardenSM position ahead of what we expect to be a compelling profit cycle once the current macro headwinds abate.”
09. Monster Beverage Corporation (NASDAQ:MNST)
Price Reaction after the Price Target Cut: +1.10(+2.29%)
On June 17, Stifel Nicolaus revised its target price for Monster Beverage Corporation (NASDAQ:MNST) downward from $63 to $57 while maintaining a “buy” rating. Despite this adjustment, the market responded positively, with Monster Beverage Corporation (NASDAQ:MNST) stock price rising by 2.29% following the announcement. Monster Beverage Corporation (NASDAQ:MNST) reported robust financial performance in the first quarter of 2024, achieving record net sales of $1.9 billion, marking an impressive 11.8% increase compared to the previous year. This financial performance, however, was slightly below expectations, with normalized earnings per share at $0.42, missing estimates by $0.01. Additionally, revenue fell short of forecasts by $4.18 million. The company completed a substantial $3 billion share buyback program, repurchasing approximately 5.4% of its outstanding common stock, demonstrating confidence in its financial position and commitment to enhancing shareholder value. Looking ahead, Monster Beverage Corporation (NASDAQ:MNST) is preparing for a leadership transition in 2025, with Co-CEOs Rodney Sacks and Hilton Schlosberg slated to step down. The company continues to focus on sustaining its growth trajectory and reinforcing its market position in the competitive beverage industry.
Here is what Carillon Tower Advisers specifically said about Monster Beverage Corporation (NASDAQ:MNST):
“Monster Beverage Corporation (NASDAQ:MNST) develops and sells energy drinks and concentrates. The company’s shares outperformed, driven by an impressive earnings report highlighted by better than expected organic growth. Management also gave guidance that indicated a potential bottom in gross margins, as well as upcoming price increases that helped give investors confidence in its growth outlook.”
08. Nucor Corporation (NYSE:NUE)
Price Reaction after the Price Target Cut: +2.69(+1.74%)
On June 17, BMO Capital revised its price target for Nucor Corporation (NYSE:NUE), a prominent player in the steel industry, lowering it from $185 to $175. This adjustment was made in response to concerns regarding the challenging steel market environment, encompassing volatile prices and uncertain demand dynamics that could potentially impact Nucor Corporation (NYSE:NUE) financial performance in the upcoming quarters. Despite reducing the price target, BMO Capital reaffirmed its “Market Perform” rating on Nucor Corporation (NYSE:NUE), indicating continued confidence in the company’s long-term growth prospects amidst current market challenges. In contrast, Citi Research upgraded Nucor to a Buy rating with a more optimistic target price of $240, citing potential opportunities for growth. Nucor Corporation (NYSE:NUE) itself anticipates lower earnings for the second quarter of 2024, projecting an EPS in the range of $2.20 to $2.30. This forecast is below the consensus estimate of $3.00, reflecting the anticipated impact of market conditions on the company’s profitability.
In recent strategic moves, Nucor Corporation (NYSE:NUE) completed the acquisition of Rytec Corporation, a commercial door manufacturer, for $565 million. Analysts at Jefferies view this acquisition as a strategic initiative that will not only expand Nucor Corporation (NYSE:NUE) downstream investments but also diversify its product offerings, potentially bolstering its market position in related sectors. Additionally, Nucor Corporation (NYSE:NUE) is in the midst of a significant leadership transition, with Douglas J. Jellison set to retire and Randy J. Spicer scheduled to assume the role in May 2024. This leadership change underscores Nucor Corporation (NYSE:NUE) commitment to continuity and effective management amid evolving market conditions and strategic transformations within the company.
07. NIKE, Inc. (NYSE:NKE)
Price Reaction after the Price Target Cut: +1.61(+1.72%)
On June 17, Evercore ISI adjusted its perspective on NIKE, Inc. (NYSE:NKE), lowering its price target from $117 to $110 while maintaining an Outperform rating on the stock. This revision reflects Evercore ISI’s concerns about a challenging environment ahead for the sportswear giant, exacerbated by mixed results from key product launches in the fourth fiscal quarter and potential order cancellations for Fall 2024. These factors contribute to expectations that NIKE, Inc. (NYSE:NKE) might revise down its revenue guidance for the first half of fiscal 2025, now anticipated to decline by 4% year-over-year, a more pessimistic outlook compared to earlier estimates. Despite these challenges, Evercore ISI remains optimistic about NIKE, Inc. (NYSE:NKE) long-term prospects, citing potential for a significant recovery despite the possibility of near-term disappointment if fiscal 2025 outlook adjustments are necessary. The firm notes that NIKE, Inc. (NYSE:NKE) stock price has stabilized, suggesting that market expectations may already account for potential earnings per share adjustments for fiscal 2025, currently projected below the consensus of $3.95.
Evercore ISI’s analysis underscores NIKE, Inc. (NYSE:NKE) proactive inventory management and strategic investments for growth, supported by substantial cost savings of $2 billion. Additionally, the firm highlights confidence from NIKE, Inc. (NYSE:NKE) key retailers in the company’s innovation pipeline for 2025. In response to its revised outlook, Evercore ISI has also lowered its fiscal 2025 EPS estimate for Nike to $3.60, down from $3.90 previously, indicating alignment with their cautious stance. Despite these adjustments, Evercore ISI emphasizes NIKE, Inc. (NYSE:NKE) transparent approach to turnaround strategies and aggressive steps to position itself for a meaningful recovery in the coming year.
06. RH (NYSE:RH)
Price Reaction after the Price Target Cut: +1.75(+0.76%)
On June 17, Loop Capital lowered its price target for RH (NYSE:RH) from $350 to $230. This decision comes in response to concerns about the company’s performance, which is affected by ongoing challenges such as a high-end housing market slowdown and broader macroeconomic headwinds. These factors have led to reduced consumer spending on luxury home furnishings, prompting the downward revision of RH (NYSE:RH) price target. Loop Capital took a cautious approach, acknowledging the positive impact of RH (NYSE:RH) recent product launches but expressing skepticism about their ability to fully counter broader economic uncertainties. The revised price target of $230 reflects Loop Capital’s more conservative view on the company’s short-term prospects given these economic conditions. The firm’s analysis underscores that while RH (NYSE:RH) new products may attract consumer interest, they could encounter difficulties amid uncertain economic conditions affecting consumer spending and overall demand, crucial factors for the company’s performance. In summary, Loop Capital’s updated assessment of RH (NYSE:RH) reflects recent financial disappointments and a cautious outlook on the company’s future amidst economic uncertainties. The Hold rating advises investors to maintain their current positions, recommending a careful approach until clearer signs of recovery emerge.
Baron Discovery Fund stated the following regarding RH (NYSE:RH) in its first quarter 2024 investor letter:
“During the quarter, we added to our position in RH (NYSE:RH), a high-end retailer of home furnishings and furniture that has a unique vision to transform from a domestic furniture company to a global luxury brand. Shares were pressured in the earlier part of the quarter due to shorter-term concerns regarding demand amid a volatile macroeconomic environment. Despite these short-term pressures, we remain confident in RH’s ability to gain market share in the fragmented high-end furnishings market, and we see a multi-year growth pipeline driven by store expansion around the globe. We also believe that RH will see improvements in profitability as the brand returns to a fuller-priced sales environment, and as it begins to scale its early international investments.”
05. The Macerich Company (NYSE:MAC)
Price Reaction after the Price Target Cut: -0.01(-0.07%)
On June 17, The Goldman Sachs Group revised its outlook on The Macerich Company (NYSE:MAC), lowering the price target from $14.00 to $12.50 and assigning a “sell” rating to the stock. Following this adjustment, The Macerich Company (NYSE:MAC) stock price reacted with a slight decrease of 0.07%. Goldman Sachs’ decision to lower the price target and designate a “sell” rating reflects concerns about The Macerich Company (NYSE:MAC) financial performance and the challenging operating environment in the real estate investment trust (REIT) sector. In its latest quarterly earnings announcement on April 30, the company reported a normalized Funds from Operations (FFO) of $0.31 per share, missing expectations by $0.08, and a GAAP EPS of -$0.59, falling short by $0.49. However, Macerich managed to surpass revenue estimates, posting $208.78 million, which exceeded expectations by $5.26 million.
Here’s how Smead Capital Management mentioned The Macerich Company (NYSE:MAC) in the Q2, 2022 investor letter:
“Leading the downside were stocks we own tied to any economic optimism. Warner Bros. Discovery (WBD) suffered selling from AT&T (T) shareholders disposing of it upon distribution of the shares in the merger. We have been too optimistic about how long it would take for these uninterested parties to sell. The Macerich Company (NYSE:MAC) suffered from fears of what a recession and higher interest rates would do to their business, disregarding the recovery in the Class “A” mall space since 2020.”
04. Accenture plc (NYSE:ACN)
Price Reaction after the Price Target Cut: -1.18(-0.41%)
On June 17, Barclays analyst Ramsey El-Assal revised his outlook on Accenture plc (NYSE:ACN), reducing the price target from $390 to $350 while reaffirming the overweight rating for the company. This adjustment stems from revised projections for Accenture plc (NYSE:ACN) revenue growth, reflecting challenges observed in the consulting and technology services sector. Despite these sector-specific difficulties, Barclays remains optimistic about Accenture plc (NYSE:ACN) long-term prospects, maintaining an “Overweight” rating. This positive stance is grounded in Accenture plc (NYSE:ACN) robust market position and strategic focus on digital transformation and cloud services, which are expected to drive future growth and resilience in the face of current market challenges. Following the price target cut, Accenture plc (NYSE:ACN) stock reacted with a slight decrease of 0.41%, reflecting investor sentiment in response to Barclays’ revised assessment.
Polen Global Growth Strategy stated the following regarding Accenture plc (NYSE:ACN) in its first quarter 2024 investor letter:
“We eliminated our position in Nestlé and trimmed our existing position in Accenture plc (NYSE:ACN). Finally, we added to our existing position in Globant with the proceeds from trimming back our Accenture position. We think this is prudent because Globant’s valuation isn’t much higher than Accenture’s, but it should be able to grow EPS faster at ~20%+ over the next five years. We see both as excellent businesses benefiting from similar tailwinds behind the increasing need for trusted third party IT services providers and continue to feel good about holding both companies for the long term.”
03. Celsius Holdings, Inc. (NASDAQ:CELH)
Price Reaction after the Price Target Cut: -1.54(-2.57%)
On June 17, Roth MKM analyst Sean McGowan reiterated a Buy rating for Celsius Holdings, Inc. (NASDAQ:CELH) but adjusted the price target downwards from $96 to $87. This decision follows recent downward revisions by several analysts, sparked by PepsiCo Inc.’s inventory reduction affecting Celsius Holdings, Inc. (NASDAQ:CELH). McGowan’s adjustment reflects concerns over Celsius Holdings, Inc. (NASDAQ:CELH) growth rates potentially slowing more than initially forecasted. Similarly, analysts at TD Cowen, Stifel, Wedbush, Jefferies, and Morgan Stanley have also revised their price targets downward, aligning with the broader sentiment surrounding Celsius Holdings, Inc. (NASDAQ:CELH) performance outlook. The stock reacted to the price target cut with a decline of 2.57%, indicating investor response to the revised expectations from analysts.
Alger Mid Cap Growth Fund stated the following regarding Celsius Holdings, Inc. (NASDAQ:CELH) in its first quarter 2024 investor letter:
“Celsius Holdings, Inc. (NASDAQ:CELH) engages in the development, marketing, sale, and distribution of functional drinks and liquid supplements. It also offers post-workout functional energy drinks and protein bars. During the quarter, shares contributed to performance after reporting solid fiscal first quarter results, where revenues and earnings beat analyst estimates. The strong quarter was largely attributed to continued partnership success with large global soft drink manufacturers. Moreover, the company signed a partnership with Ferrari racing, emulating the success of other energy drink competitors within F1 racing. Given the encouraging operating results, we continue to believe Celsius is well positioned to potentially capture market share within the large energy and soft drink industry.”
02. PG&E Corporation (NYSE:PCG)
Price Reaction after the Price Target Cut: -0.47(-2.58%)
On June 17, Barclays revised its outlook on PG&E Corporation (NYSE:PCG), lowering the price target from $22 to $21 while maintaining an “overweight” rating. The price reaction after the price target cut was a decline of 2.58%. In its latest quarterly earnings announcement on April 25, PG&E Corporation (NYSE:PCG) reported a normalized EPS of $0.37, which exceeded expectations by $0.03. However, PG&E Corporation (NYSE:PCG) revenue of $5.86 billion fell short of expectations by $872.05 million. The company forecasts a 10% growth compared to the previous year, with an expected earnings per share (EPS) ranging from $1.33 to $1.37. PG&E Corporation (NYSE:PCG) remains positive about its long-term growth, predicting an annual EPS increase of at least 9% from 2025 to 2028. As part of its five-year financial strategy, the company has outlined a $62 billion capital investment plan, which excludes the potential sale of a minority stake in Pacific Generation.
Third Point Management made the following comment about PG&E Corporation (NYSE:PCG) in its Q1 2023 investor letter:
“Our strategy is to preserve liquidity and buying power to take advantage of markets when they “break”. While overall indices remain elevated, we are finding more chances to provide liquidity across all three asset classes in which we invest – credit, structured credit, and equity – opportunities which have been key drivers of performance for the fund. Our portfolio is balanced across industries with a focus on event-driven names including companies involved in spin-offs, significant cost-cutting, or other types of under-appreciated business transformation. PG&E Corporation (NYSE:PCG), which is still our largest position, continues to deliver strong performance, down 50bps in the first quarter but up 6.2% for the year to date after the Fire Victims Trust sold another 60 million shares in a block trade.”
01. Shattuck Labs, Inc. (NASDAQ:STTK)
Price Reaction after the Price Target Cut: -1.2100(-19.55%)
On June 17, Citigroup analyst Yigal Nochomovitz adjusted his outlook on Shattuck Labs, Inc. (NASDAQ:STTK), a biotechnology firm specializing in cancer therapies. He maintained a “Buy” rating but lowered the price target from $10 to $9. This revision follows the company’s latest clinical trial results, which showed promising complete response rates of 29% in the TP53m-AML cohort and 42% in the HR-MDS cohort. These rates compare favorably to benchmark data, suggesting significant potential for the treatment. Nochomovitz highlighted that these response rates could improve further as patients continue their treatment. Despite the encouraging results, there were concerns about two reported cardiac events, which need to be monitored closely. Shattuck Labs, Inc. (NASDAQ:STTK) is also preparing to launch two Phase 1b trials, with outcomes anticipated in the second half of 2025. These trials are expected to provide additional insights into the therapy’s efficacy and safety. The market reacted negatively to the price target cut, with Shattuck Labs, Inc. (NASDAQ:STTK) stock dropping by 19.55%.
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