Here are Thursday's biggest analyst calls: Nvidia, Tesla, Apple, Microsoft, Meta, CoreWeave & more

Wall Street analysts issued a series of ratings adjustments, with a strong positive sentiment toward AI and cloud infrastructure plays following robust earnings from tech giants. KeyBanc upgraded Microsoft to overweight, citing its Azure product's strength, while Citi upgraded CoreWeave and reiterated Buy ratings on Nvidia, Broadcom, and AMD, anticipating increased cloud data center capex from Microsoft and Meta. Conversely, Palo Alto Networks was downgraded by KeyBanc due to strategic concerns post-acquisition, and UnitedHealth saw a downgrade from Baird on negative catalysts. Other notable calls included Evercore ISI resuming Chevron as outperform on free cash flow inflection and Goldman Sachs initiating Galaxy Digital as neutral, citing an elevated valuation despite its transition to AI data center infrastructure.

Analysis

A strong bullish sentiment for the AI and cloud infrastructure ecosystem prevails, driven by robust earnings and forward-looking capital expenditure guidance from technology bellwethers Microsoft and Meta. This is evidenced by KeyBanc's upgrade of Microsoft to Overweight, citing the strength of its Azure product, and Citi's upgrade of CoreWeave and buy reiterations for Nvidia and Broadcom, all directly linked to an anticipated 35% YoY growth in cloud data center capex for 2025. Conversely, specific strategic concerns are creating headwinds for certain firms, notably Palo Alto Networks, which was downgraded to Sector Weight by KeyBanc following its acquisition of CyberArk. Similarly, UnitedHealth received a downgrade to Neutral from Baird due to an accumulation of negative catalysts. Beyond technology, analysts see selective opportunities in cyclicals, with Jefferies upgrading Nucor to Buy on an improving demand outlook for steel, and Evercore ISI resuming coverage on Chevron with an Outperform rating based on its significant free-cash flow inflection potential. Cautious or neutral stances were maintained on several mega-caps, with Jefferies reiterating a Hold on Apple despite strong iPhone demand and Wolfe maintaining a Peer Perform rating on Tesla, balancing challenges in its auto business against growth in energy and FSD catalysts.

Key Decisions for Investors

• Consider overweighting exposure to the AI and cloud infrastructure value chain, as beneficiaries of increased capex from Microsoft and Meta, such as Nvidia, Broadcom, and CoreWeave, have received positive analyst revisions.
• Scrutinize companies involved in recent M&A, such as Palo Alto Networks, as analyst downgrades indicate that strategic concerns and integration risks can create significant headwinds for stock performance.
• Look for opportunities in cyclical sectors outside of technology, where specific catalysts are identified, such as the improving demand outlook for Nucor or the compelling free-cash flow story at Chevron.
• Exercise caution with UnitedHealth, as Baird's downgrade to Neutral flags multiple negative catalysts and potential valuation downside, warranting a review of positions in the managed care sector.