Street Calls of the Week: Upgrade for Shake Shack; downgrade for Old Domion
Investing.com — Here is your Pro Recap of the top takeaways from Wall Street analysts for the past week: upgrades for Shake Shack, G-III Apparel, Sea and Textron; downgrade for Old Dominion.
InvestingPro subscribers always get first dibs on market-moving rating changes.
What happened? On Monday, Barclays downgraded G-III Apparel (NASDAQ:GIII) stock to Underweight with a $23 price target.
What’s the full story? Barclays’ downgrade is primarily driven by three factors: an anticipated 2% revenue headwind over a three-year period due to the announced Macy’s store closures on 2/27/24, the impact of lost licenses on the business over the next five years, and the subdued search interest in owned brands, suggesting a longer timeframe to counterbalance revenue headwinds.
The investment bank remains confident that GIII will continue to seek license agreements with new brands. However, there is limited visibility into potential agreements, their commencement, and whether they could sufficiently replace the lost Calvin Klein and Tommy Hilfiger businesses.
The analysts also believe that potential acquisitions beyond the core women’s and outerwear businesses could introduce additional execution risk.
Underweight at Barclays means “The stock is expected to underperform the unweighted expected total return of the industry coverage universe over a 12-month investment horizon.”
How did the stock react? GIII stock traded lower on the premarket headlines from $33.11 to $31.87, a decline of around 4.25%. GIII opened the regular session at $32.23 and closed at $29.73, a decline of 10.56%.
What happened? On Tuesday, JPMorgan upgraded Sea Ltd (NYSE:SE) to Overweight with a $70 price target.
What’s the full story? JPMorgan believes that in the
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