Friday's analyst calls: General Electric gets upgraded, Deutsche names a top Chinese EV pick
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(This is CNBC Pro’s live coverage of Friday’s analyst calls and Wall Street chatter. Please refresh every 20-30 minutes to view the latest posts.) An industrial giant and Chinese electric vehicle play were in focus among Friday’s analyst calls. JPMorgan upgraded shares of General Electric to overweight. Meanwhile, Deutsche Bank initiated Li Auto with a buy rating. Check out the latest calls and chatter below. All times ET. 5:41 a.m.: Deutsche Bank initiates Chinese electric vehicle manufacturer Li Auto as buy Li Auto looks primed to capitalize on the growing Chinese electric vehicle market, according to Deutsche Bank. The bank initiated coverage of the Chinese electric vehicle manufacturer at a buy rating. Analyst Bin Wang cited the company’s market positioning as one of its greatest catalysts and called it a top pick. “Li Auto is the largest 6 / 7 seater vehicles manufacturer in China with a 13.8% market share in 2023, which is the sweet spot of the automobile electrification mega-trend in China,” he wrote. Wang noted that the firm is slated to enter the pure electric vehicle market this month with the Mega MPV, its new flagship vehicle. Li Auto also plans to strengthen its position as the second-largest plug-in hybrid electric vehicle maker through the launch of its L6 large-size SUV next month. Li Auto is also emerging as an industry leader in the AI-powered autonomous driving field, Wang added. Additionally, the company had the highest gross margin among China new energy vehicle manufacturers, with the figure coming out to 21.2% in the first half of last year. “This is a result of Li Auto garnering a higher average selling price (ASP) from its 6 / 7 seater vehicle segment exposure and best-of-breed execution efficiency, which leads to a lower-per-unit fixed cost than peers,” Wang said. U.S.-listed shares of Li Auto have slipped close to 3% this year. — Lisa Kailai Han 5:41 a.m.: JPMorgan upgrades GE to overweight General Electric has been on a roll recently, and JPMorgan expects the outperformance to continue. The bank upgraded the conglomerate to overweight from neutral. It also hiked its price target to $180 from $166, implying upside of 13%. “It is clear that GE is the premier large cap name in Comml Aero with regard to 1) the business, 2) where that business is in the cycle, 3) the balance sheet, and 4) the mgmt team,” analyst Seth Seifman wrote. “Some of this is priced in and valuation is an obstacle … but it is the only obstacle for us right now and with upside remaining, we think the companys fundamental strength wins out,” Seifman added. “Vernova looks promising as well based on rebounding margins and cash flow, as well as diversified exposure to the long-term energy transition.” GE shares rose 1% in the premarket following the upgrade. Year to date, they are up more than 30%. DIS YTD mountain DIS year to date — Fred Imbert
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