4 big analyst cuts: Salesforce near-term catalysts 'in rear-view mirror'

Here is your Pro Recap of the biggest analyst cuts you may have missed since yesterday: downgrades at Salesforce, Estée Lauder, Tractor Supply, and General Electric.

InvestingPro subscribers got this news first. Never miss another market-moving headline.

Salesforce cut at Morgan Stanley ahead of Q2

Morgan Stanley downgraded Salesforce (NYSE:CRM) to Equalweight from Overweight with a price target of $278.00 (from $251.00), as reported in real time on InvestingPro.

While confident in Salesforce's longer-term opportunity to further penetrate large enterprises with more vertically oriented solutions, near-term catalysts, including margin expansion and price increases, are now in rear-view mirror.

The bank mentioned that generative AI could potentially serve as the next catalyst for a higher Salesforce rating in the future. However, they do not foresee this happening in the short term due to limited access to its Unlimited Edition tiers in Sales and Service Clouds, as well as uncertainty surrounding "access, capabilities and pricing of consumption credits (which are expected to be the more significant driver on GenAI-related growth vs. seatbased uplifts)."

The company is set to report its Q2/24 earnings on Aug 23.

Estée Lauder slashed at Citi

Estée Lauder (NYSE:EL) shares fell more than 1.5% premarket today after Citi downgraded the company to Neutral from Buy and cut its price target to $195.00 from $240.00. The bank expressed concerns about the potential risks to the recovery path for the Asian Travel Retail business over the next 6-12 months.

We remain optimistic about the long-term revenue and margin opportunities at EL, but we expect weaker results over the next few quarters with negative incremental data points (China macros/category trends, share dynamics, cybersecurity incident).

2 more downgrades

Barclays downgraded Tractor Supply (NASDAQ:TSCO) from Overweight to Equalweight and cut its price target to $224.00 from $254.00. The decision comes in the wake of the company's disappointing Q2 results announced last week, which fell short of consensus estimates.

The downgrade stems from concerns about the company's growth prospects and uncertainty surrounding its performance going forward.

Oppenheimer downgraded General Electric (NYSE:GE) to Perform from Outperform, fueled by valuation concerns, highlighting over 35% stock rally since it upgraded the stock back in December.

Last week, the company reported a Q2 beat and raised its full-year outlook.

Get ready to supercharge your investment strategy with our exclusive discounts.

Don't miss out on this limited-time opportunity to access cutting-edge tools, real-time market analysis, and expert insights. Join InvestingPro today and unlock your investing potential. Hurry, the Summer Sale won't last forever!