Early Look

Thursday, July 3, 2025

U.S. stock index futures held steady overnight as investors awaited the monthly jobs report for insights on the health of the labor market and the Federal Reserve's plans for monetary easing. In trade news, the Trump administration has lifted export license requirements for chip design software sales in China, implementing a trade deal to ease some restrictions on essential technologies. Three leading semiconductor software providers — Synopsys (SNPS), Cadence Design Systems (CDNS) and Germany’s Siemens (SIEGY) were told by the Commerce Department that they no longer need to seek licenses for business in China, lifting shares. Markets have been quiet the last two days, though the S&P 500 and Nasdaq both closed at record highs on Wednesday (and the Dow about 1% from its ATH), boosted by gains in technology stocks and a trade agreement between the U.S. and Vietnam that eased concerns.

President Trump announced a trade deal with Vietnam saying goods imported to the US would face a 20% tariff, lower than the 46% tariff he had levied as part of his "Liberation Day" plans but higher than the blanket 10% tariff currently in effect. The news lifted shares of retailers that manufacture goods in Vietnam such as Nike (NKE), Wayfair (W) and ON Holdings (ONON). Now all eyes are on the nonfarm payrolls report for June, which is scheduled to be released at 8:30 a.m. ET - a day ahead of schedule because the U.S. markets are closed on July 4 for Independence Day. Trading volumes are expected to be light, with markets closing early, at 1 p.m. ET on Thursday. The jobs data is expected to show the U.S. labor market slowed further in June, with the unemployment rate expected to have edged up to more than a three-and-a-half-year high of 4.3%. In Asian markets, The Nikkei Index rose 23 points to 39,785, the Shanghai Index gained 6 points to 3,461, and the Hang Seng Index fell -151 points to 24,069. In Europe, the German DAX is up 27 points to 23,818, while the FTSE 100 is up 30 points to 8,805. What a run it’s been for stocks as the S&P is now up 28.19% from the April 7th “Liberation Day” lows or in 55 trading days!

• The Dow Jones Industrial Average slipped -10.52 points, or 0.02%, to 44,484.42
• The Nasdaq Composite gained 190.24 points, or 0.94%, to 20,393.13
• The Russell 2000 Index advanced 28.84 points, or 1.31% to 2,226.38

• 8:30 AM ET                   Private Payrolls for June…est. +105K (prior +140K)
• 8:30 AM ET                   Manufacturing Payrolls for June…est. (-5K) vs. prior -8K
• 8:30 AM ET                   Unemployment Rate for June…est. 4.3% (prior 4.2%)
• 8:30 AM ET                   Average Hourly Earnings M/M for June…est. +0.3% (prior +0.4%)
• 8:30 AM ET                   Weekly Jobless Claims…est. 240K
• 8:30 AM ET                   Continuing Claims…est. 1.956M
• 9:45 AM ET S&P Global Composite PMI, June-Final…prior 52.8
• 9:45 AM ET S&P Global Services PMI, June-Final…prior 53.1
• 10:00 AM ET                 Durable Goods Orders M/M for May
• 10:00 AM ET                 Factory Orders M/M for May
• 10:00 AM ET ISM Non-Manufacturing Index for June…est. 50.5
• 10:30 AM ET                 Weekly EIA Natural Gas Inventory Data

• UK government bonds rallied on Thursday after Sir Keir Starmer said Rachel Reeves would be chancellor for a “very long time to come” following market jitters sparked by speculation about her future. Earlier, Starmer's failure to confirm her position in Parliament, coupled with Reeves’ emotional appearance, triggered a sell-off of UK assets amid concerns over fiscal stability.
• President Donald Trump and Ukrainian President Volodymyr Zelenskiy are expected to discuss the abrupt halt in some key U.S. weapons deliveries to Kyiv in a call on Friday, the Financial Times reported on Thursday.

• Tesla (TSLA) ended a six-session losing streak even as the electric-vehicle maker posted its worst quarterly decline for deliveries in its history. The company delivered 384,122 cars in the second quarter, down 13.5% from the 444,000 cars delivered a year earlier. The results were better than Wall Street expectations.
• Tesla's (TSLA) new car sales in Germany down 60% in June y/y to 1,860
• Xponential Fitness (XPOF) said the Securities and Exchange Commission concluded its investigation into the company without acting.

• Nippon Steel (NPSCY) said it would raise 800 billion yen ($5.6 billion) through two subordinated loans to partially fund its recent $14.9 billion acquisition of U.S. Steel and refinance previous loans.

• Franklin Covey (FC) Q3 EPS ($0.11) vs est. ($0.04), adj EBITDA $7.307Mm vs est. $4.523Mm on revs $67.121Mm vs est. $67.5Mm; guides FY revs $265-275Mm vs est. $276.55Mm and adj EBITDA $28-33Mm vs est. $30.54Mm.

• Synopsys (SNPS), Cadence (CDNS) shares rise overnight after the US eased export restrictions on China for chip design software, as software firms like Synopsys, Cadence and Siemens (SIEGY) said they will now sell their chip design tools to Chinese customers again. https://tinyurl.com/27cj6j8v
• Tripadvisor (TRIP) shares climbed after The Wall Street Journal reported activist investor Starboard Value had built an over 9% stake in the travel company https://tinyurl.com/3e6rxdd4
• Meta Platforms (META) was upgraded to Hold from Underperform at Needham with no price target saying channel checks are driving upside to the firm's estimates, but the analyst remains on the sidelines with a Hold because the firm believes Meta's strategy diffusion wastes capital and adds risks.
• Alibaba Group (BABA) said it is seeking to raise around HK$12 billion ($1.53 billion) through exchangeable bonds to boost investments in cloud infrastructure and global commerce operations.
• The latest version of U.S. President Trump's "Big Beautiful Bill" could make it cheaper for semiconductor manufacturers to build plants in the U.S. Under the bill, tax credits for semiconductor firms would rise to 35% from 25%, which is more than the 30% increase in the draft version of the bill – CNBC. Companies eligible for the credits include Intel (INTC), TSM (TSM), and Micron Technology (MU), provided they expand their manufacturing in the U.S. before a 2026 deadline https://tinyurl.com/mr4yj4jc

Mid-Morning Look

Wednesday, July 02, 2025

U.S. stocks are struggling for direction for a second straight day, holding just below recent record highs for the S&P 500 and Nasdaq after surging all last week while the Dow remains 1% away from its December best, as investors shake off a very weak ADP private payroll report ahead of tomorrows jobs report. The weaker-than-expected jobs data (payrolls fell -33K in June vs. est. +97K) fueled expectations that the Fed may cut rates sooner than expected. US Fed funds futures raise chances of a July rate cut to 27.4% after ADP data vs roughly 20% pre-data release. In stock news, managed care names hit (MOH, ELV) after CNC withdrew its guidance as the company now sees a sharp negative revision to its ACA Marketplace results, TSLA rises on Q2 deliveries, China stocks moving lower, large banks rise on buybacks/dividend increases following stress test, and crypto assets moving higher with Bitcoin moving back to $108,000 (lifting crypto complex).

Outside of data, President Trump’s signature OBBBA tax/spending bill passed the Senate by the tightest of margins on Tuesday, as VP Vance casting the deciding vote after a 50-50 split, while a House vote is expected as soon as Wednesday, but the bill faced pushback from some Republicans. On trade, Trump threatened to raise tariffs on Japan Tuesday and cast doubt that a trade deal would be reached. Trump threatened Japan with tariffs of up to 35% and also said he is not considering delaying his July 9 deadline and impose duty rates on several nations. Treasury yields are moving higher as well as the US dollar.

Volatility in Europe as the yield on the 10-year UK government bond, or gilt, rose more than 20 basis points on the day at one point to 4.66%, as investors ditched UK debt. British government bond yields jumped sharply, and the pound tumbled a day after the government was forced to sharply scale back plans to cut benefits, and accelerating declines after finance minister Rachel Reeves appeared distressed in Parliament.

• In Industrials: PWR was downgraded from Outperform to Market Perform w/ $354 PT at Northland noting Quanta trades with the basket of AI-related companies, and to be fair, the growing demand for its services is partly due to the increasing demand for electricity to run data centers. However, it is not a fabless semiconductor company; its growth scales with headcount and is augmented by acquisitions. BV shares fell after the commercial landscaping company cut its revenue guidance to $2.68B-$2.73B from $2.75B-$2.84B (est. $2.78B), while narrowing FY25 adj Ebitda to $348M-$362M from $345M-$365M. KBR was downgraded to Neutral from Buy at UBS saying it has had some negative developments recently in its MTS (gov't) segment, and UBS doesn't see enough visibility to positive catalysts at the moment.
• In Managed Care: CNC shares tumbled after withdrawing its 2025 EPS guidance as the company now sees a sharp negative revision to its ACA Marketplace results after reviewing its marketplace data with actuarial firm Wakely. The data covers 22 of CNC’s 29 Marketplace states – about 72% of CNC’s exchange membership. Mizuho said they would not be buyers on weakness and look for increased clarity on CNC's ability to reprice HIX for 2026 and increased visibility on the extent of Medicaid MLR pressures (both JP Morgan and UBS downgraded the stock on the news, dragging MOH, ELV lower). CNBC’s David Faber said CVS, CI are not exposed.

• ENVX +11%; announced that its Board of Directors has authorized a share repurchase program under which the company may repurchase up to $60 million of its outstanding common stock.
• GBX +16%; shares jumped on results as day posted Q3 adj EPS of $1.86, above Wall Street estimates of $0.99 and revenue rose 2.7% y/y to $842.70M above expected $785.72M.
• HUT +14%; seeing strength in Bitcoin miners (WULF, CLSK, MARA, RIOT) on the back of Bitcoin strength which is rising back around $108,000.
• ROST +1%; upgraded to Buy from Hold at Jefferies and raised its tgt to $150 from $135 saying the retailer is well-positioned to outperform as comps should accelerate through the end of the year, and EBIT should expand by 170 basis points over the next three years.
• TSLA +3%; shares jumped after delivering 384,122 vehicles in Q2, down -13.5% from 443,956 units a year ago, but not far between est. ranges of 370-394K; separately, June China-made EV sales +0.8% y/y, 1st rise in 9 months; Q2 China-made deliveries fall 6.8% y/y, third such fall in a row.
• VRNT +7%; after Bloomberg reported private equity firm Thoma Bravo is negotiating the terms of a potential deal to acquire the company. The Bloomberg report follows a report by Semafor on Tuesday saying that Verint is seeking a buyer. https://tinyurl.com/3p2kjysn

• BABA -2%; as US listed China stocks (JD, PDD, BIDU) open the day weaker.
• BV -14%; after the commercial landscaping company cut its revenue guidance to $2.68B-$2.73B from $2.75B-$2.84B (est. $2.78B), while FY25 adj Ebitda narrowed to $348M-$362M from $345M-$365M.
• CNC -38%; after the managed care co withdrew its 2025 EPS guidance as the company now sees a sharp negative revision to its ACA Marketplace results after reviewing its marketplace data with actuarial firm Wakely. The data covers 22 of CNC’s 29 Marketplace states – about 72% of CNC’s exchange membership (shares of MOH, ELV tumbled in sympathy).
• OSCR -14%; after Barclays initiates coverage at underweight saying the stock presents asymmetric downside risk after shares gained more than 50% in June alone on speculative retail interest despite elevated policy risks (Centene withdrawing its 2025 guidance also potentially weighing on shares).
• RIVN -3%; produced 5,979 vehicles in Q2 and delivered 10,661 vehicles in quarter, reaffirms 2025 delivery guidance; said received $1 billion equity investment from Volkswagen group at $19.42per share.

Closing Recap

Thursday, July 03, 2025

U.S. stock markets continue to amaze, pushing higher again amid further signs of an improving economy as monthly nonfarm payrolls come in well above consensus/show decline in unemployment, while ISM Services data and factory orders also showed strength, boosting investor sentiment. There hasn’t been much to fret about of late with signs of a solid labor market, tariff deals are starting to materialize (China, Vietnam) benefitting the U.S., inflation has slowed the last 4 months (as per data), and even geopolitical situations (Israel/Iran and Ukraine/Russia) have cooled. This has led to a massive +25% plus rally over 55 days since the April pullback, pushing the S&P 500 and Nasdaq to record highs (and the Dow knocking on records) led by a renewed rally in the AI/Data center/power sectors, and record runs for financials and industrials. Heading into the 4^th of July holiday tomorrow (and early 1:00 pm et close for the NYSE exchange today), fireworks for U.S. stocks indeed with the S&P and Nasdaq at all-time highs, Bitcoin prices not far from all-time highs, gold prices not far from record highs, housing prices remain elevated – while the National debt, credit card debt also at record highs! For the week, S&P 500 up 1.72%, Nasdaq up 1.62%, Dow up 2.3%.

While today’s headline jobs data was strong, notable parts of the job gains showed the weakest private sector growth since October 2024 (per CNBC Liesmann) as 73K of the +147K job gains were on the gov't side. The stronger jobs results boosting Treasury yields as the chance of Fed rate cuts in the n-t lessen; the 2-yr yield +8bps to 3.87% and 10-yr +3.5bps to 4.328%. The U.S. dollar also spiked following the monthly jobs headline, unemployment figures on signs the economy remains strong (while inflation remains subdued). August gold prices fall following the spike in the dollar/yields an ounce as n-t rate cut expectations lessen post jobs data. Traders have significantly dialed back bets on interest-rate cuts after Thursday's stronger-than-expected jobs report as per WSJ. Interest-rate futures showed the chances of an interest-rate cut in July falling to 5% from 24% Wednesday, according to CME Group data. The chances of three or more 25bps cuts by the end of the year fell to 30% from 56%. The chances of one or zero cuts this year rose to 25% from 9%.

In Trade News this week: Ahead of the July 9^th trade/tariff deadline with nations, yesterday President Trump announced a trade deal with Vietnam. Under the agreement, a 20% tariff will apply to Vietnamese exports, and a 40% levy will target goods deemed transshipped through the country, while Vietnam will eliminate all tariffs on US imports. Meanwhile the Trump administration removed export license requirements for chip design software sales to China part of the US-China trade deal. We’ll see if any new trade deals arise in coming days with Japan, India, EU, Canada among the ones most high profile.

In Sentiment data: The bull-bear spread in the American Association of Individual Investors (AAII) weekly survey was +11.9 vs -5.2 last week. Bulls surge to 45% from 35.1%, Neutrals fall to 21.9% from 24.7%, Bears fall to 33.1% from 40.3%. This week’s NAAIM Exposure Index reading surged to 99.30, falling from last week's 81.41, the highest reading since the 99.24 reading on 12/11 - recent trough from 4-17 of 35.16 - Last Quarter Average (Q2) of 73.28. Both showing potential short-term peaking signs as contra indicators.

• The June unemployment rate surprisingly fell to 4.1% from prior 4.2% and the consensus 4.3% while the June U-6 underemployment rate was at 7.7%. June average workweek all private workers 34.2 hours as June average hourly earnings +3.7% y/y below consensus +3.9% and M/M rose +0.2% vs. est. +0.3%)
• Weekly Jobless Claims fell to 233,000 in the latest week (6-week low) vs. consensus 240,000; the 4-week moving average fell to 241,500 from 245,250 prior week; continuing claims unchanged at 1.964M and above the consensus of 1.956M; the insured unemployment rate unchanged at 1.3% in the latest week.
• ISM Non-Manufacturing Services) activity picked up in June as orders rebounded, but employment contracted for the third time this year, Overall ISM services PMI increased to 50.8 last month from 49.9 in May and above ests 50.5 (expansion above 50 reading). The new orders measure rebounded to 51.3 last month from 46.4 in May, services employment fell to 47.2 from 50.7 in May; prices paid for services inputs eased to a still-high 67.5 from 68.7 in May, which was the highest level since November 2022.
• U.S. May factory orders surge +8.2%, in-line with consensus +8.2% and vs April -3.9%; factory orders ex-transportation +0.2% vs April -0.6%; factory orders ex-defense +7.5% vs April -4.3%; nondurables orders +0.1% vs April -1.0%; nondefense cap orders ex-aircraft unrevised at +1.7%; May shipments revised to +0.4% from +0.5%; inventories/shipments ratio 1.58 months' worth vs April 1.58 months
• The May trade deficit in-line with consensus at (-$71.5B) and vs April deficit (-$60.3B); U.S. may goods deficit $97.51B, services surplus $25.99B; the May exports (-4.0%) vs April +3.4%, imports (-0.1%) vs April (-16.3%); U.S. May exports $279.00B vs April $290.57B, imports $350.52B vs April $350.83B.
• U.S. S&P Global June final composite PMI at 52.9 (vs flash 52.8) and U.S. S&P Global June final services PMI at 52.9 (vs flash 53.1).

• TRIP shares jumped after The Wall Street Journal reported activist investor Starboard Value had built an over 9% stake in the travel company https://tinyurl.com/3e6rxdd4
• XPOF shares jumped after saying the Securities and Exchange Commission concluded its investigation into the company without acting.

• Homebuilders (LEN, TOL, LEN, KBH, DHI) shares slipped, paring recent gains as Treasury yields jumped
• US ethane producers (ET, EPD) said the gov’t has removed license requirements for shipping the gas to China, clearing the way for deliveries to the country’s ports without additional approvals
• In Packaging: Citigroup raised its Q2 EBITDA estimates for all its covered beverage packagers (CCK, AMBP, BALL, OI) by 2%-3% on average to reflect outperformance in North America and modest help from foreign exchange impacts.
• In Solar: sector outperforms as China to curb disorderly competition in industry; Beijing wants to push out lower-quality producers, stabilize prices, and limit excess capacity. That could mean fewer ultra-cheap Chinese panels flooding global markets—and more pricing power for Western players. Shares of FSLR advanced amid less competition fears; domestic installers like RUN, SEDG may benefit from rising import costs while ENPH, NXT, who are heavily reliant on Chinese components could see higher input costs could compress margins.
• In Industrials: Orders for new heavy-duty commercial trucks (CMI, PCAR) in June dropped by 36% from the same month last year, reflecting the continued weakness in the freight-hauling industry. Orders for 9,400 trucks were placed last month in the U.S., Canada and Mexico, according to the preliminary estimate from market forecaster ACT Research. The orders were down 25% from May

• In Bank Research: Wolfe Research with a few ratings changes as they downgraded PNC to Per Perform from Outperform as sees relatively less upside torque in PNC, which screens as expensive vs the Outperform-rated banks in its coverage that generate higher returns; they upgraded HBAN to Outperform saying additional fixed-rate asset repricing tailwinds and HBAN's ability to match fund its loan growth with strong deposit growth reinforce Wolfe's belief that NIM will expand into 2026. VLY was upgraded to Overweight at Morgan Stanley saying Valley has taken significant actions over the past year to reduce its concentration in commercial real estate, increase its reserve ratio, and build capital.
• In Bitcoin/Crypto: Bitcoin prices with a strong finish to the week, topping $110,000 today and up 2.5% on month and over 17% YTD; IREN shares jumped after announces purchase of 2,400 next-generation NVDA Blackwell B200 and B300 GPUs worth $130/says acquisition is fully funded from existing cash and expects the investment to deliver attractive risk-adjusted returns and support discussions around its AI Data Center business; RIOT said it produces 450 bitcoin in June 2025; Bitcoin miners strong WULF, CLSK, MARA, HIVE.
• In REITs: in Agency Mortgage REITs: Citizens downgraded TWO to Market Perform from Outperform, lowered ests for AGNC, ARR, DX while raised ests for IVR, NLY, ORC and TWO saying they updated its earnings models for the Agency MREIT group to reflect the current interest rate and macro environment. Prison REITs (CXW, GEO) advanced after the Senate version of the "One Big Beautiful Bill Act" aligns with the House version when it comes to spending on immigration, and the proposal should be beneficial to both.

• SMMT shares active after Bloomberg reported is in talks for $15B partnership with AZN to license Summit's ivonescimab lung-cancer treatment.

• In Media: ROKU tgt was raised to $110 from $100 at Bank America ahead of results and raises its 2H forecast to reflect an improving macro backdrop saying Roku's efforts over the last several years should better insulate them from macro shocks relative to prior cycles. TKO tgt was raised to $20o from 4185 at Bank America as anticipates another strong quarter from TKO, but focus will likely remain on upcoming media rights renewals.
• In Internet: META was upgraded to Hold from Underperform at Needham with no price target saying channel checks are driving upside to the firm's estimates, but the analyst remains on the sidelines with a Hold because the firm believes Meta's strategy diffusion wastes capital and adds risks.
• In Software: DDOG shares jumped after being added to the S&P 500 index, replacing JNPR after HPE closed its Juniper Networks deal on Wednesday. CRWD shares hit record highs after Wedbush raised its tgt to $575 from $525, saying the security software co is gaining traction with customers and deals are progressing well and notes AI is helping drive more demand.
• In AI/Data Center: CRWV announces first NVDA GB300 NVL72 Deployment. CRWV says their joint collaboration with DELL, VRT and Switch on this deployment of the Nvidia GB300 NVL72 is fundamental to their speed and agility, providing the critical support they need to turn groundbreaking technology into a reality for their customers at an unprecedented pace.

Street Recommendations

Thursday, July 3, 2025

• ROKU BofA analyst Brent Navon raised the firm's price target on Roku to $110 from $100 and keeps a Buy rating on the shares. The macro uncertainty of the past few months appears to be abating, and while industry-wide advertising trends had been impacted earlier in April, sentiment has improved as the quarter progressed, the analyst tells investors in a research note. There could be potential upside to Roku's fiscal year outlook, BofA says.
• TDOC BofA raised the firm's price target on Teladoc to $8.75 from $7 and keeps a Neutral rating on the shares. Teladoc's recent acquisitions of Catapult and Uplift provide optionality to drive higher revenue per member, but it will take both time and execution to improve the revenue growth outlook, the analyst tells investors in a research note. BofA remains cautious on full-year guidance and momentum into 2026 but views recent acquisitions as potential catalysts for growth.

• ECL Citi raised the firm's price target on Ecolab to $320 from $285 and keeps a Buy rating on the shares. Driven by strong underlying growth in the Institutional and Life Sciences segments, the firm sees Ecolab "comfortably" hitting its Q2 EPS guidance midpoint of $1.89, the analyst tells investors in a preview for the firm's North America specialty chemicals coverage.
• CCK Citi analyst Anthony Pettinari raised the firm's price target on Crown Holdings to $129 from $119 and keeps a Buy rating on the shares and opened a "30-day positive catalyst watch" on what it identifies as its top pick in Packaging. The firm is raising Q2 EBITDA estimates for all its covered beverage packagers by 2%-3% on average to reflect outperformance in North America and "modest help" from foreign exchange impacts, the analyst tells investors.
• AMBP Citi raised the firm's price target on Ardagh Metal Packaging to $5 from $4 and keeps a Buy rating on the shares. The firm is raising Q2 EBITDA estimates for all its covered beverage packagers by 2%-3% on average to reflect outperformance in North America and "modest help" from foreign exchange impacts, the analyst tells investors.
• BALL Citi raised the firm's price target on Ball Corp. to $63 from $55 and keeps a Neutral rating on the shares. The firm is raising Q2 EBITDA estimates for all its covered beverage packagers by 2%-3% on average to reflect outperformance in North America and "modest help" from foreign exchange impacts, the analyst tells investors.
• OI Citi analyst Anthony Pettinari raised the firm's price target on O-I Glass to $16 from $14 and keeps a Neutral rating on the shares. The firm is raising Q2 EBITDA estimates for all its covered beverage packagers by 2%-3% on average to reflect outperformance in North America and "modest help" from foreign exchange impacts, the analyst tells investors.
• CARG Citi analyst Ronald Josey lowered the firm's price target on CarGurus to $37 from $40 and keeps a Neutral rating on the shares. The firm is raising its U.S. Marketplace revenue and EBITDA projections by 3% and 8%, respectively, for 2026, but adds that Digital Wholesale pressures are likely to continue in Q2 and believes the margin expansion trajectory is likely to slow in 2025.

• AVGO Mizuho analyst Vijay Rakesh raised the firm's price target on Broadcom to $315 from $310 and keeps an Outperform rating on the shares. The firm raised estimates and price targets for a number of names in the semiconductors and semiconductor capital equipment group as it took a look at the data center and AI server market following a re-rating post the "Liberation Day" selloff and ahead of June quarter earnings.
• CRDO Mizuho raised the firm's price target on Credo Technology to $98 from $81 and keeps an Outperform rating on the shares. The firm raised estimates and price targets for a number of names in the semiconductors and semiconductor capital equipment group as it took a look at the data center and AI server market following a re-rating post the "Liberation Day" selloff and ahead of June quarter earnings.
• INTC Mizuho raised the firm's price target on Intel to $23 from $22 and keeps a Neutral rating on the shares. The firm raised estimates and price targets for a number of names in the semiconductors and semiconductor capital equipment group as it took a look at the data center and AI server market following a re-rating post the "Liberation Day" selloff and ahead of June quarter earnings.
• SMCI Mizuho analyst Vijay Rakesh raised the firm's price target on Super Micro to $47 from $40 and keeps a Neutral rating on the shares. The firm raised estimates and price targets for a number of names in the semiconductors and semiconductor capital equipment group as it took a look at the data center and AI server market following a re-rating post the "Liberation Day" selloff and ahead of June quarter earnings.

• VLY Morgan Stanley upgraded Valley National to Overweight from Equal Weight with a price target of $11, up from $10. Valley has taken significant actions over the past year to lower its commercial real estate concentration, increase its reserve ratio, and build capital, but the balance sheet improvement and earnings growth story are not reflected in valuation, the analyst tells investors.
• ARGX Morgan Stanley assumed coverage of Argenx with an Overweight rating with a price target of $700, down from $750. The firm sees ongoing robust growth in Vyvgart that has an underappreciated opportunity in new indications with a strong balance sheet, the analyst tells investors in a research note. Vyvgart's additional indications could add roughly $3B in sales by 2035, while the development of ARGX-213 may extend Argenx's revenue post-Vyvgart patent expiry, the firm says.
• SDGR Morgan Stanley analyst Sean Laaman assumed coverage of Schrodinger with an Equal Weight rating with a price target of $28, down from $31. Schrodinger has faced volatility due to a combination of macroeconomic factors, underperformance on initial clinical results and uncertainty on valuation and revenue drivers, the analyst tells investors in a research note. Schrodinger's software business provides a steady stream of revenue that acts as a safety net for the stock, regardless of the outcomes of partnerships and the proprietary pipeline, the firm says.
• ABSI Morgan Stanley assumed coverage of Absci with an Overweight rating and $7 price target. Absci has faced volatility due to a combination of macroeconomic factors, underperformance on initial clinical results and uncertainty on valuation and revenue drivers, the analyst tells investors in a research note. The upcoming value inflection points with the second half of 2025 interim data readout for TL1A asset ABS-101 and second half of 2026 Phase I interim proof of concept efficacy readout for PRLR ABS-201 present potential results skewed to the upside for Absci, the firm says.
• RXRX Morgan Stanley assumed coverage of Recursion Pharmaceuticals with an Equal Weight rating and $5 price target. Recursion has faced volatility due to a combination of macroeconomic factors, underperformance on initial clinical results and uncertainty on valuation and revenue drivers, the analyst tells investors in a research note. The recent pipeline prioritization and stage of clinical development for the proprietary pipeline leaves several open questions on valuation, the analyst tells investors in a research note.
• AXSM Morgan Stanley assumed coverage of Axsome Therapeutics with an Overweight rating and $190 price target. The firm sees an on-time supplemental new drug application submission for AXS-05 in Alzheimer's Disease agitation as the base case and is modeling $900M in sales in 2030E. Morgan Stanley is encouraged by the continued launch progress of Auvelity in major depressive disorder and awaits the outcomes of the expanded sales force and additional commercial dynamics, the analyst tells investors in a research note.
• INCY Morgan Stanley assumed coverage of Incyte with an Equal Weight rating with a price target of $73, up from $68. The firm sees an improving set-up for shares approaching key data updates expected this year for mCALR and JAK2V617Fi in Myelofibrosis, and Phase II data for povorcitinib in asthma in the second half of 2025 presents an opportunity to further prove out the potential for povo beyond hidradenitis suppurativa, the analyst tells investors in a research note.
• IRON Morgan Stanley assumed coverage of Disc Medicine with an Overweight rating and $85 price target. The near-term focus is on bitopertin with the new drug application submission under the accelerated approval pathway in 2H25 and DISC-0974 data expected in December, the analyst tells investors in a research note. The firm models a 2026 launch for bitopertin and $1.3B in unadjusted U.S. peak sales for bitopertin.
• CERT Morgan Stanley assumed coverage of Certara with an Equal Weight rating and $16 price target. The firm says it awaits further potential updates on Certara's strategic review of the regulatory services business and management commentary regarding the near- or mid-term impact that may result from Certara's opportunity set coming from the FDA's previous announcement to gradually reduce animal testing in favor of new approach methodologies.
• BMRN Morgan Stanley assumed coverage of BioMarin with an Overweight rating with a price target of $97, down from $105. BioMarin is trading at a 10-year low, more than adequately reflecting risk to its Voxzogo franchise, the analyst says. Morgan Stanley believes the potential opportunity in other patient populations and the company's pipeline may be underappreciated by the Street.

• HMN Piper Sandler raised the firm's price target on Horace Mann to $45 from $44 and keeps a Neutral rating on the shares. The firm is reducing its EPS estimates in the space driven by continued fee and spread headwinds. This was confirmed by a rather challenging pre-announcement of variable investment income from MetLife (MET) in late June suggesting this swing factor for a large chunk of lifecoland got sequentially worse, which also - in Piper's opinion - pushes out the normalization factor towards 2026.
• PFG Piper Sandler analyst John Barnidge raised the firm's price target on Principal Financial to $89 from $88 and keeps an Overweight rating on the shares. The firm is reducing its EPS estimates in the space driven by continued fee and spread headwinds. This was confirmed by a rather challenging pre-announcement of variable investment income from MetLife (MET) in late June suggesting this swing factor for a large chunk of lifecoland got sequentially worse, which also - in Piper's opinion - pushes out the normalization factor towards 2026.
• UNM Piper Sandler raised the firm's price target on Unum Group to $92 from $88 and keeps an Overweight rating on the shares. The firm is reducing its EPS estimates in the space driven by continued fee and spread headwinds. This was confirmed by a rather challenging pre-announcement of variable investment income from MetLife (MET) in late June suggesting this swing factor for a large chunk of lifecoland got sequentially worse, which also - in Piper's opinion - pushes out the normalization factor towards 2026.
• TRUP Piper Sandler analyst John Barnidge raised the firm's price target on Trupanion to $62 from $52 and keeps an Overweight rating on the shares. The firm notes the company experienced higher than expected level of enrolled pets in Q1, which indicates strong product adoption. Trupanion is seeing positive traction across the vet channel, which should help support future growth in enrolled pets, Piper adds.

• DCO RBC Capital analyst Ken Herbert raised the firm's price target on Ducommun to $95 from $72 and keeps an Outperform rating on the shares as part of a broader research note offering a positive outlook for "small cap defense tech" names. The sector is poised for continued outperformance, driven by the growth in FY26 defense spending, idiosyncratic positioning in growth markets - including space, missiles, missile defense, hypersonics, unmanned, and AI - as well as some company specific valuation mismatches, the analyst tells investors in a research note.
• KTOS RBC Capital analyst Ken Herbert raised the firm's price target on Kratos Defense to $50 from $38 and keeps an Outperform rating on the shares as part of a broader research note offering a positive outlook for "small cap defense tech" names. The sector is poised for continued outperformance, driven by the growth in FY26 defense spending, idiosyncratic positioning in growth markets - including space, missiles, missile defense, hypersonics, unmanned, and AI - as well as some company specific valuation mismatches, the analyst tells investors in a research note.
• MRCY RBC Capital raised the firm's price target on Mercury Systems to $55 from $50 and keeps a Sector Perform rating on the shares as part of a broader research note offering a positive outlook for "small cap defense tech" names. The sector is poised for continued outperformance, driven by the growth in FY26 defense spending, idiosyncratic positioning in growth markets - including space, missiles, missile defense, hypersonics, unmanned, and AI - as well as some company specific valuation mismatches, the analyst tells investors in a research note.

• MCO Wells Fargo raised the firm's price target on Moody's to $573 from $572 and keeps an Overweight rating on the shares. The firm expects Moody's to beat Street estimates in Q2 from slightly better-than-expected issuance and notes strong momentum exiting the quarter. Further, Wells expects Moody's will reiterate its FY25 guidance.
• SPGI Wells Fargo raised the firm's price target on S&P Global to $632 from $627 and keeps an Overweight rating on the shares. The firm expects S&P Global to beat Street estimates in Q2 from slightly better-than-expected issuance and notes strong momentum exiting the quarter. Further, Wells expects S&P Global will raise guidance solely on Indices.

Rating abbreviations…

***OP = Outperform

***SP = Sector Perform

***UP = Underperform

***OW = Overweight

***EW = Equal-weight

***UW = Underweight

***Report powered by thefly.com***

What’s on Tap Weekly Calendar

• Earnings After the Close: none

• 7:45 AM ET ICSC Weekly Retail Sales
• 8:55 AM ET                   Johnson/Redbook Weekly Sales
• 1:00 PM ET U.S. Treasury to sell $58B in 3-year notes
• 3:00 PM ET                    Consumer Credit for May
• 4:30 PM ET API Weekly Inventory Data

• Earnings After the Close: KRUS PENG SAR

• 10:00 AM ET                 Wholesale Inventory M/M for May
• 10:30 AM ET                 Weekly DOE Inventory Data
• 1:00 PM ET U.S. Treasury to sell $39B in 10-year notes

• Earnings After the Close: AZZ BSET

• 8:30 AM ET                   Continuing Claims
• 10:30 AM ET                 Weekly EIA Natural Gas Inventory Data
• 1:00 PM ET U.S. Treasury to sell $22B in 30-year notes

• Earnings After the Close: ETWO LEVI PSMT WDFC

• 1:00 PM ET                    Baker Hughes Weekly rig count data

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