Investment Analysts’ Upgrades for April, 16th (ABMD, AIV, AZN, C, EAT, EWBC, EXR, FAF, GS, HOLX)

Investment Analysts’ upgrades for Tuesday, April 16th:

ABIOMED (NASDAQ:ABMD) was upgraded by analysts at Zacks Investment Research from a sell rating to a hold rating. According to Zacks, “ABIOMED continues to gain from its flagship Impella, which performed strongly in the United States recently. Impella’s patient success stories and increasing global adoption are added positives. The recent CE Mark for Impella Connect is a major positive. Revenues from Japan also shot up recently. Meanwhile, a raised guidance for fiscal 2019 is indicative of brighter prospects. Considerable expansion in the operating margin buoys optimism. Meanwhile, surging R&D expenses show increasing focus on innovation. In fact, the company continues to invest in training and education. On the flip side, contraction in ABIOMED’s gross margin is concerning. Margins have been primarily hurt by unfavorable sales mix and heavy manufacturing investments. Intense competition in the MedTech industry adds to the woes. ABIOMED has underperformed the industry in a year’s time.”

Apartment Investment and Management (NYSE:AIV) was upgraded by analysts at Zacks Investment Research from a sell rating to a hold rating. According to Zacks, “Apartment Investment and Management Company, better known as Aimco, is making diligent efforts to improve portfolio mix through property sales, and reinvesting the proceeds in accretive acquisitions, capital enhancements and redevelopments. Furthermore, its diversified portfolio is well positioned to absorb demand from for apartment properties driven by echo boomers. However, the dilutive effect on earnings from asset dispositions and adverse impact on rent growth from elevated supply in various markets are concerns. Also, the company’s shares have underperformed its industry over the past year. Moreover, the trend in estimate revisions for 2019 funds from operations (FFO) per share does not indicate a favorable outlook for the company.”

AstraZeneca (NYSE:AZN) was upgraded by analysts at Zacks Investment Research from a hold rating to a buy rating. Zacks Investment Research currently has $45.00 target price on the stock. According to Zacks, “AstraZeneca’s core drugs like Nexium, Crestor and Seroquel are facing generic competition, which is hurting sales. The diabetes unit also faces stiff competition while pricing pressure is hurting sales in the Respiratory unit. Nonetheless, AstraZeneca returned to product sales growth in the second half of 2018 on the back of its newer drugs and looks confident of seeing sustained growth for several years. Newer drugs like Lynparza, Tagrisso and Imfinzi should keep contributing to sales. Meanwhile, several launches are underway across each of the therapeutic areas – Oncology, CV metabolism and Respiratory. AstraZeneca also has a promising late-stage pipeline that includes immuno-oncology candidates. AstraZeneca’s shares have outperformed the industry this year so far. The company has a positive record of earnings surprises in the recent quarters. Estimates have gone down slightly ahead of the company’s Q1 earnings release.”

Citigroup (NYSE:C) was upgraded by analysts at Zacks Investment Research from a sell rating to a hold rating. According to Zacks, “Shares of Citigroup have underperformed the industry over the past six months. Yet, the company has an impressive earnings surprise history, beating the Zacks Consensus Estimate in all the trailing four quarters. First-quarter 2019 results reflect cost control, loan growth and lower revenues. The company’s restructuring and streamlining efforts, along with strategic investments in core business, bode well for the long term. Also, the company’s declining costs base supports its bottom-line improvement. Recently, the company set foot in the booming digital consumer payments industry, thereby expanding sources of revenues. However, pending litigation issues might keep legal expenses elevated. Moreover, dismal performance of equity market revenues keeps the top line under pressure.”

Brinker International (NYSE:EAT) was upgraded by analysts at Zacks Investment Research from a hold rating to a buy rating. Zacks Investment Research currently has $47.00 target price on the stock. According to Zacks, “Although shares of Brinker have underperformed the industry in a year’s time, we are encouraged by the company's robust top- and bottom-line growth. The company’s traffic-building strategies and efforts to capture increased market share boosted the performance.  Brinker’s strong To-Go business continues to drive the performance. Meanwhile, Chili’s turnaround strategy has started to pay off. Increased focus on company-owned restaurants, which allows it to have full control over operations, is also expected to boost results. However, high costs associated with restaurant operations might hurt its profitability in the future. Further, dismal performance of international franchise comparable sales at Chili's restaurants is a major concern. The company is plagued with intense competition characterizing the industry. Estimates for current quarter and year have been stable over the past 60 days.”

East West Bancorp (NASDAQ:EWBC) was upgraded by analysts at Zacks Investment Research from a sell rating to a hold rating. According to Zacks, “East West Bancorp's shares have underperformed the industry over the past six months. Yet, the company has an impressive earnings surprise history, surpassing the Zacks Consensus Estimate in each of the trailing four quarters. Increase in loans and deposits along with higher interest rates are expected to support the company’s revenues. Moreover, its steady capital deployment actions reflect strong balance sheet position. However, rise in operating expenses remains a major concern for the company, as it will likely hurt profitability to some extent. Further, the company's significant exposure to risky loan portfolios is likely to hamper financials. Also, earnings estimates have been going down ahead of the company's first quarter 2019 results.”

Extra Space Storage (NYSE:EXR) was upgraded by analysts at Zacks Investment Research from a sell rating to a hold rating. According to Zacks, “Extra Space Storage enjoys presence in key cities and opts for joint ventures to drive long-term profitability. Focus on expansion of the geographical footprint through accretive acquisitions and third-party management platforms also bode well. However, the company operates in a highly fragmented market in the United States, with intense competition from numerous private, regional and local operators. In addition, there is a development boom of self-storage units in many markets. This high supply is likely to intensify competition for the company, curb its power to raise rents and turn on discounting. Also, shares of Extra Space Storage underperformed its industry in three months’ time. Moreover, the trend in estimate revisions for 2019 funds from operations (FFO) per share does not indicate an upbeat outlook for the company.”

First American Financial (NYSE:FAF) was upgraded by analysts at Zacks Investment Research from a hold rating to a buy rating. They currently have $61.00 target price on the stock. According to Zacks, “Shares of First American Financial have outperformed the industry year to date. The company has been continually investing in increasing efficiency, improving risk profile and enhancing product offerings. It envisions being the premier title insurance and settlement service company. The company should continue to benefit from strength in commercial business. The company has been actively investing in complementary businesses that support or expand the core business. Strategic acquisitions strengthen its core business and expand its valuation and data businesses. Also, it focuses on expansion of digital closing services. Riding on operational excellence, it enjoys a strong balance sheet and engages in effective capital deployment. The company aims 12-14% return on equity over the long term. However, increasing expenses raise concern. The company expects purchase market decline to continue in 2019.”

Goldman Sachs Group (NYSE:GS) was upgraded by analysts at Zacks Investment Research from a sell rating to a hold rating. According to Zacks, “Shares of Goldman have underperformed the industry in the past three months. Yet, the company boasts an impressive earnings surprise history, outpacing the Zacks Consensus Estimate in all the trailing four quarters. The first-quarter 2019 results reflected strong financial advisory revenues and reduction in expenses, partly offset by disappointing performance of Institutional Client Services division and lower underwriting business. Notably, Goldman has been embroiled in the heightened scandal related to the multibillion-dollar 1Malaysia Development Bhd (1MDB), which is a major concern. However, the company’s well-diversified business and focus to capitalize on growth opportunities through strategic moves, along with cost-control efforts, will continue to strengthen the overall business.”

Hologic (NASDAQ:HOLX) was upgraded by analysts at Zacks Investment Research from a sell rating to a hold rating. According to Zacks, “Hologic is suffering from escalating cost pressure which has continued to exert pressure on the company's adjusted operating margin. Also, company operating in a highly competitive landscape is a concern. On a positive note, we are upbeat about the recent product launches like the Omni hysteroscope and Panther Fusion Open Access functionality in the United States, the Panther Fusion Bordetella assay in Europe, and the Surgical hand piece for the TempSure radiofrequency system in North America. Backed by a portfolio of differentiated products, the company’s Breast Health business has been going strong. We are also looking forward to the company's receipt of global approvals for its Omni hysteroscope. Hologic has outperformed its industry over the past year.”

Hill-Rom (NYSE:HRC) was upgraded by analysts at Zacks Investment Research from a hold rating to a buy rating. They currently have $118.00 target price on the stock. According to Zacks, “Hill-Rom saw a solid year-over-year increase in revenues on robust domestic growth, driven by sturdy performance by Patient Support Systems and Front Line Care in the last reported quarter. The company has recorded around $100 million in new product revenues in the quarter. We are also upbeat about Hill-Rom’s integration of EarlySense’s continuous contact-free heart rate and respiratory rate sensing and analytics technology with its Centrella Smart+ bed platform in the reported quarter. Also, the tie-up with Microsoft to make advanced, relevant and actionable point-of-care data and solutions buoys optimism. Overall, Hill-Rom has outperformed its industry in the past six months. However, foreign exchange and a tough competitive landscape remain headwinds. Also, Hill-Rom’s global revenues declined in the quarter.”

Madison Square Garden (NYSE:MSG) was upgraded by analysts at Zacks Investment Research from a hold rating to a buy rating. The firm currently has $344.00 target price on the stock. According to Zacks, “Shares of Madison Square have outperformed the industry in the past year. The last reported quarter marked Madison Square’s second straight quarter of earnings and revenue beat. Results benefited from robust performance of both the Entertainment and Sports segments. Apart from its strong brand presence, the company’s entertainment business continues to grow on innovative venues and overall positive scenario in the concert market, which is commendable. Also, Madison Square is consistently benefiting from its ongoing efforts to reinstate growth through multi-night and multi-marketing agents. Moreover, continual partnerships to expand its footprint bode well. Estimates have also been revised upward over the past two months. However, intense competition in the sports business remains a concern.”

Pacific Biosciences of California (NASDAQ:PACB) was upgraded by analysts at Zacks Investment Research from a sell rating to a hold rating. According to Zacks, “Pacific Biosciences has been gaining grounds in the MedTech space, thanks to strong Sequel performance, which witnessed record bookings. Meanwhile, one of Pacific Biosciences’ biggest rival — Illumina — recently announced that it is acquiring the former for $8 per Pacific Biosciences share (in an all-cash transaction). Per management, the total value of the deal is approximately $1.2 billion. The agreement is expected to close by mid-2019. Reflective of these, the company outperformed its industry in a year’s time. On the flip side, dull performance in the service and other revenue segment stemming from lower instrument revenues is a headwind. The DNA sequencing market is rife with competition. Sales in Europe declined considerably in the last-reported quarter. Also, higher operating expenses are likely to mar prospects.”

Pool (NASDAQ:POOL) was upgraded by analysts at Zacks Investment Research from a hold rating to a buy rating. Zacks Investment Research currently has $191.00 price target on the stock. According to Zacks, “Pool, which has outperformed the industry in the past year, has shown both top and bottom line improvement year over year in the last-reported quarter. Revenue growth can be primarily attributable to improved performance of the company’s base business. For 2019, the company expects EPS in the range of $6.05-$6.35, up from $5.62 reported in 2018. Meanwhile, continuous growth in remodel and replacement sectors of its business is a major positive. The company’s leading market share position and opportunistic expansion strategies position it well for revenue growth. Nonetheless, seasonality of Pool’s business and macroeconomic headwinds due to solid global presence are worrisome. Higher labor and delivery costs remains a concern.”

Qiagen (NYSE:QGEN) was upgraded by analysts at Zacks Investment Research from a sell rating to a buy rating. The firm currently has $45.00 target price on the stock. According to Zacks, “QIAGEN ended the fourth quarter on a disappointing note. Sales in the Americas were sluggish, affected by the decline in instrument service revenues in the Molecular Diagnostics customer class. Competitive landscape and strong reliance on collaborations remain major overhangs. On a positive note, QIAGEN reported double-digit growth in Japan and China. The company projects over $300 million of QuantiFERON sales in 2020. It also continues to expect DiaSorin automation solution availability in the United States in 2019 and in China in 2020. Within NGS, QIAGEN has set a goal for 2019 sales of about $190 million. The company is also moving ahead with new placements of the QIAsymphony automation platform and expects to reach more than 2,500 cumulative placements in 2019. Meanwhile, QIAGEN’s commitment to return to shareholders reflects solid cash position. QIAGEN outperformed its industry over the past three months.”

Red Rock Resorts (NASDAQ:RRR) was upgraded by analysts at Zacks Investment Research from a sell rating to a hold rating. According to Zacks, “Shares of Red Rock Resorts have underperformed the industry in the past six months. The company reported better-than-expected results in the fourth-quarter 2018. Both earnings and revenues also surpassed the Zacks Consensus Estimate in three of the trailing four quarters. Furthermore, Red Rock Resorts’ Las Vegas operations have been a key growth driver for the company over the past few quarters. This apart, it has been witnessing solid EBITDA growth for the past several quarters, which is impressive.  However, the company might fail to finance upcoming projects due to a higher debt burden. Also, competitive operating environment remains a potential headwind. Estimates for the current year have witnessed downward revisions in the past 7 days, reflecting analysts concern regarding the company’s growth potential.”

Tetraphase Pharmaceuticals (NASDAQ:TTPH) was upgraded by analysts at Zacks Investment Research from a sell rating to a hold rating. According to Zacks, “Tetraphase Pharmaceuticals, Inc. is a life science company engaged in developing and commercializing tetracycline based drugs to treat drug-resistant infectious diseases, inflammation, and cancer. Its principal products include eravacycline, an intravenous and oral antibiotic for the treatment of multi-drug resistant Gram-negative infections. The Company’s product under development includes eravacycline oral formulation, TP-834 and TP-271. Tetraphase Pharmaceuticals, Inc. is based in Watertown, Massachusetts. “

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