Review Of Analyst Upgrades This Week - Part IV

by: The Value Investor

Analysts have been sending out their research reports to their clients again this week. The following is a review of the most important upgrades for the week of April 30 till 4 May.


R.W. Baird raised its advice for NuVasive (NASDAQ:NUVA) from neutral to outperform with a $24 price target. The broker sees some 19% upside for the medical device company focused on spine procedures. Shares rose 19% on the week after the company reported a strong first quarter earnings report and the after the company reiterated its full year outlook.

RenaissanceRe Holdings

Barclays Capital raised its advice for RenaissanceRe Holdings (NYSE:RNR) from equalweight to overweight with a $95 price target. The UK-based bank raised its advice for the global provider of reinsurance services as shares rallied more than 2% during the week after the company reported a first quarter net profit compared to a loss last year.


Barclays Capital raised its advice for Allstate (NYSE:ALL) from equalweight to overweight with a $39 price target. According to the bank shares of the insurance company have some 14% further upside after the company gained already 2% over the week. The company reported a strong first quarter in which profits rose 46% as catastrophe and other insurance losses fell on the year.


KeyBanc Capital Markets initiated its advice for Huntsman (NYSE:HUN) to buy with $20 target. The broker thinks there is some 35% upside for the manufacturer of differentiated chemical products. Shares already rose more than 3% during the week after the company reported strong first quarter results. According to KeyBanc, the risk-reward profile remains attractive despite the recent price appreciation. Positive secular trends in Polyurethanes and Performance Products will drive performance.


Bank Of America/Merrill Lynch raised its advice for Centerpoint (NYSE:CNP) from neutral to buy with a $22 price target. There is some 10% upside for the utility company as the company is an "attractive gas infrastructure story with long term growth investment prospects". In case the company will create a master-limited partnership for the $1.7 billion proceeds from the Texas Supreme Court decision, the long term value could be $27 per share.

Sempra Energy

Bank of America/Merrill Lynch raised its advice for Sempra Energy (NYSE:SRE) from neutral to buy with a $71 price target. According to the bank there is some 9% upside for the energy holding company. "There is still meaningful upside in the stock despite the fact that Sempra has been one of the best performing utilities year to date". Further share appreciation is driven by regulated utilities, the renewable energy division and mostly by the change in LNG liquefaction.

Whole Foods Market

JP Morgan raised its advice for Whole Foods Market (WFM) from neutral to overweight with a $105 price target. There is some 17% upside potential as solid operating momentum remains a driver for the shares. Shares gained some 7% over the week as the company reported strong quarterly results accompanied by a raise in the full year earnings outlook. Shares of the organic supermarket chain have already returned 29% year to date.

Chesapeake Energy

Alliance Bernstein raised its advice for Chesapeake Energy (NYSE:CHK) to outperform with a $21 price target. Alliance sees 21% upside potential for the troubled natural gas producer which has seen its shares fall some 22% already year to date. The broker sees multiple triggers for the shares to move upwards after the company has been hit hard by falling natural gas prices and corporate governance issues after CEO McClendon engaged in "daily and exhaustive" calls with the hedge fund called Heritage Management Company LLC which was founded by Chesapeake co-founder Tom Ward.

Credit Suisse raised its advice from neutral to outperform for (NYSE:CRM) with a $185 price target. The Suisse-based bank sees 16% upside potential for the provider of enterprise cloud computing applications as "upgrade and expansion cycles are underway across multiple application segments". is most leveraged to the technology refresh, more than any other company in the world. Shares have already returned up to 50% year to date after raising the fiscal 2013 year guidance.

American Eagle Outfitters

Wedbush raised its advice for American Eagle Outfitters (NYSE:AEO) from neutral to outperform with a $22 price target. Shares in the specialty retailer have already returned 31% year to date as the company revised its earnings estimate for the first quarter upwards. Wedbush raises its advice for the retailer and sees 10% more upside following strong store checks. Earnings growth will increase substantially driven by sales and margin expansion. The strategy to buy less inventory and design improvement allows full-priced selling and margin recovery.

Abercrombie & Fitch

UBS raised its advice for Abercrombie & Fitch (NYSE:ANF) from neutral to buy with a price target of $66, suggesting some 30% upside for the specialty retailer. According to the bank the company's shares offer a good risk reward ratio given the trend stabilization in Europe. Higher international margins and the analysis of US store closes lead to an estimated earnings increase for 2012 and 2013. Shares have lost some 30% since the peaks of $78 in 2011 after worries about the losses at the European division.


Stock markets have seen a modest correction this week, closing almost 2.5% lower in the case of the S&P 500. Despite the slight correction, brokers have send out favorable research reports again to their clients. Many of the recommendations were made after the release of earnings reports and often come after a large move to the upside. However on the day of the announcement, analyst recommendations can still move the stock price significantly.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.