Notable analyst calls this week: J&J, Intel and Adobe among top picks

The S&P 500 closed positively last week, fueled by favorable inflation data, while the Nasdaq and Dow saw declines of 1.7% and 0.9%, respectively.

Notable upgrades included Johnson & Johnson, which was raised to Buy by Guggenheim due to promising prospects in its Innovative Medicine division, and Intel, upgraded by Seaport Global Research on potential short-term stabilizing investments.

Adobe faced a downgrade from Overweight to Equal-weight by Morgan Stanley amid concerns over its progress in monetizing generative AI, while ServiceNow was upgraded to Overweight due to strong fundamentals despite market volatility.

Analysts also raised price targets for several companies, such as Tesla and Apple, in light of expected growth in AI and successful product cycles, indicating a cautious optimism in the market outlook.

Investment Insights: Weekly Market Summary and Analyst Recommendations

The S&P 500 (SP500) concluded the trading session on Friday with positive gains, bolstered by encouraging inflation data that enhanced investor confidence.

Over the week, the Nasdaq (COMP:IND) and Dow (DJI) experienced declines, with losses of 1.7% and 0.9%, respectively.

Analysts on Wall Street issued a variety of upgrades and downgrades. Below are some notable recommendations from the week:

Johnson & Johnson Receives Upgrade from Guggenheim

Johnson & Johnson (NYSE:JNJ) was raised from Neutral to Buy by Guggenheim, driven by the promising prospects of its Innovative Medicine division, which could counterbalance an impending patent expiration for its key product, Stelara. Analyst Vamil Divan increased the price target for JNJ from $167 to $206, acknowledging the company's effective management of the impending loss of exclusivity for its Crohn's disease treatment, projected to account for over 10% of the company’s sales in 2024. Divan noted, "With the company nearing the annual impact of this loss, we foresee robust growth in both top and bottom lines ahead," citing several JNJ products as evidence for his optimistic outlook.

Intel Upgraded by Seaport Global Research

Seaport Global Research upgraded Intel (NASDAQ:INTC) amid new external investments and “stop-gap solutions” that could stabilize its operations. Analyst Jay Goldberg remarked, "Intel is potentially misaligned with its current trajectory concerning its fabs. However, the stock may benefit in the short term from these follow-on investments and transitional solutions. We are changing our rating to Neutral (from Sell) based on these immediate factors, though we remain skeptical about the company's long-term fundamentals."

Analyst Activity on Applied Materials and Lam Research

Morgan Stanley upgraded Applied Materials (NASDAQ:AMAT) from Equal-weight to Overweight and increased the price target from $172 to $209. Analyst Shane Brett pointed out that AMAT is currently trading at a significant discount compared to Lam Research (LAM), which historically averaged a 10% discount. He noted, "With a favorable risk-reward outlook and a 3:1 ratio of bull versus bear sentiment, we believe the potential for market growth is compelling.”

In a similar vein, Lam Research (NASDAQ:LRCX) was upgraded from Underweight to Equal-weight with a price target raised from $92 to $125. The analysts acknowledged positive shifts in memory end markets and revised their 2026 earnings forecast upward. Conversely, KeyBanc Capital downgraded Lam Research to Sector Weight but simultaneously increased the price target for Applied Materials. Morgan Stanley also revised its rating for KLA (NASDAQ:KLAC) to Equal-weight while adjusting its 2026 forecasts for wafer fab equipment.

Wedbush Securities Boosts Tesla’s Price Target

Wedbush Securities increased its price target for Tesla (NASDAQ:TSLA) to $600, maintaining an Outperform rating as they foresee the company entering an accelerated phase in its artificial intelligence initiatives. Analyst Dan Ives emphasized, "Tesla's advancements in AI and robotics are positioned to redefine the company’s future, highlighting significant developments on the horizon." The firm's outlook suggests a bull case market cap of $2 trillion by early 2026, potentially rising to $3 trillion as production ramps up.

Adobe Faces Downgrade Amid AI Concerns

Adobe (NASDAQ:ADBE) was downgraded from Overweight to Equal-weight by Morgan Stanley, which expressed concerns regarding the company's ability to effectively monetize generative artificial intelligence. The price target was adjusted from $520 to $450, with Morgan Stanley noting that progress on AI monetization has lagged expectations, impacting annual recurring revenue. Analyst Keith Weiss stated, "Our previous positive outlook on Adobe relied heavily on its capability to innovate and monetize generative AI effectively, which has not matched anticipated growth."

BofA Raises Price Target for Palantir Technologies

BofA revised its price target on Palantir Technologies (NASDAQ:PLTR) upward to $215 from $180 while retaining a Buy rating, citing strengthening growth across the company’s applications.

Morgan Stanley Upgrades ServiceNow

Morgan Stanley elevated ServiceNow (NYSE:NOW) from Equal-weight to Overweight, setting a price target of $1,250. Analysts highlighted that the company’s fundamentals remain strong, despite a tumultuous market environment. Though there are concerns about generative AI risks and federal spending cuts impacting shares, the overall outlook remains positive.

Wedbush Increases Apple’s Price Target

Wedbush raised its price target for Apple (NASDAQ:AAPL) to $310 from $270, noting that the iPhone 17 has initiated a notable upgrade cycle in the consumer market.

Wells Fargo Upgrades CoreWeave

Wells Fargo upgraded CoreWeave (NASDAQ:CRWV) from Equal Weight to Overweight, raising its price target to $170 from $105, citing strong demand signals that are increasingly hard to overlook.

This week's market movements reflect a cautious yet optimistic sentiment among analysts, with significant adjustments in ratings and price targets driven by evolving company fundamentals and market conditions.