JPMorgan updates U.S. Analyst Focus List, adds 3 stocks in June update

J.P. Morgan has updated its U.S. Analyst Focus List for June 2024, featuring a selection of stocks targeted for growth, income, value, and short ideas investment strategies.

In its June update, the Wall Street giant added three stocks to the Focus List, including CarGurus (NASDAQ:CARG), Carvana Co (NYSE:CVNA), and L3Harris Technologies (NYSE:LHX).

For CARG, JPMorgan analysts see a strong revenue and earnings growth trajectory for the company in the near term, with upside revision risk to consensus estimates. Moreover, he sees downside support from recently ramped-up share repurchases.

Also added under the growth strategy, JPMorgan expects CVNA to continue strong near-term unit growth and margin trends.

"There is potential for upward revisions to consensus and further re-rating potential as confidence grows in the long-term story,” the note writes. “In addition, there is optionality around tapping into capital markets to reduce debt burden and improve out-year FCF.”

Meanwhile, the LHX stock has been added under the value strategy as the company continues to show progress on profitability “with limited risk to 2024 and potential upside to estimates.”

The December 2024 price target of $250 equates to approximately 18x the estimated adjusted free cash flow per share for 2025. Also, the target yield of around 5.5% aligns with historical trading ranges for defense stocks, suggesting LHX can close a portion of its current valuation gap with a return to cash flow growth.

On the other hand, three names, CarMax Inc (NYSE:KMX), Cars.com Inc (NYSE:CARS), and Inspire Medical Systems Inc (NYSE:INSP) were removed from last month’s Focus List.