Analysts wield too much power in the stock market. Their rating change will move the stock, if only for a few days.
On Jan. 5, Palantir (PLTR) slipped when Jefferies downgraded the stock and set a low price of $13 as the price target. The analyst thought the AI story around Palantir probably ran its course. Still, the analyst said that the firm offers customers a highly differentiated platform. The moat around data analysis ensures stable growth for the long term.
The downgrade on Apple (AAPL) is a bigger negative turn of events. Shares peaked at $199.62, shy of $200 before analysts at Piper Sandler downgraded the stock. Analyst Harsh Kumar downgraded AAPL stock to neutral, citing worries about iPhone inventory levels. Peak unit sales growth is also a concern.
Unless customers worry about their budget, they will not delay their iPhone upgrade. AAPL stock lost its $3 trillion market capitalization last week.
With short interest of 14.36%, the downgrade on SoFi Technologies (SOFI), a digital bank, sent the stock down 14.3% last week. SoFi does not trade at a good valuation, so markets sold SOFI stock after KBW’s downgrade to Underperform.
CEO Noto expects SoFi will post a profit in its upcoming earnings report. Expect this analyst to upgrade the stock after shares rally after the report.
