Calls of the day: 4th July 2024

The latest calls from Wall Street experts.

[.custom-color]Intuit[.custom-color], the financial software company behind QuickBooks, was given an Outperform rating by RBC Capital with a target price of $770. This represents a 16% upside over its current price of $660. RBC Capital believes the company has a strong future based on its "successful transition" to a subscription model, strong leadership position in the market, the potential benefits of its generative AI technology, and its potential to increase margins.

[.custom-color]First Foundation[.custom-color] dropped almost 33% this week as investors feared its commercial real estate exposure and the announcement that it had raised a $228 million investment. Despite this, DA Davidson has upgraded it to a Buy with a price target of $9, which is 80% above its current valuation. They see the injection of capital as a "clearing event" for the company that would allow it some flexibility to offer loans and reduce its concentration in certain areas.

However, not all are so positive. Stephens downgraded the company to Equal Weight and said their previous $10 price target was under review.

[.custom-color]Adobe[.custom-color] and [.custom-color]Oracle[.custom-color] were named Mizuho's top picks in technology. Jim Lebenthal of Cerity Partners concurred, stating that they are both stocks that will continue to do well in the AI boom:

"I like both of them. I find them reasonably attractive names that are good ways to play the AI space. Adobe has figured out a way to actually monetize AI, and I think it was held down for too long and is now marching higher as it should be on the back of recent earnings. Oracle is the same...attractively priced."

However, he did recommend waiting for a pullback before buying Oracle.

[.custom-color]MGM[.custom-color] is now covered by BTIG, with a Buy rating and a price target of $52, which is 21% above its current price. They believe it has a "favorable" fundamental story with profit upside driven by its Vegas and China properties. They also think most investors are underestimating MGM's growth opportunities, including their nascent digital gaming business.

[.custom-color-downgrade]Charter[.custom-color-downgrade], the largest US cable operator by subscribers, was downgraded to Sell by Citi with a revised price target of $255 as the cable market becomes "tougher" compared to expectations for the company. This follows Goldman Sachs also downgrading Charter earlier this week.

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