Analysts Return from Summer Break with Conviction Calls on Multiple Stocks
Wall Street returned from its summer break with several conviction calls on various stocks. Goldman Sachs led the pack, reshuffling its real estate coverage and citing rising interest rates and inflation as key factors separating winners from losers.
The bank upgraded Covivio to Buy, citing the French REIT's hotels division as a standout with strong rental growth potential. In contrast, Vonovia was downgraded to Neutral due to higher borrowing costs and regulatory uncertainty.
Other notable upgrades included Eaton Corporation by UBS, which lifted its price target from $450 to $515 after projecting 46% earnings growth over the next two years. Citi also upgraded Kion Group to Buy with a price target of €62.
However, some stocks faced downgrades, including Beiersdorf AG by Deutsche Bank, which expects European consumer staples to underperform due to channel disruption and slower consumer wallet growth.
JPMorgan issued a pair trade downgrade for United Rentals, citing a shrinking pool of acquisition targets, while upgrading Herc Holdings to Overweight. HSBC also reset its biopharma coverage, downgrading Amgen and upgrading Novartis.