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What has Wall Street been buzzing about this week? Here are the top 5 buy calls and the top 5 sell calls made by Wall Street's best analysts during the trading week of Sept. 2-6, 2024. First, here are the top 5 buy calls of the week.

1. Southwest Upgraded to Outperform at Evercore ISI

Evercore ISI upgraded Southwest (LUV) to Outperform from In Line with a price target of $35, up from $30. The firm cites the "long-awaited" transition to capacity discipline, new revenue initiatives to be outlined at the company's upcoming investor day on Sept. 26 -- including assigned seating and premium economy -- as well as strong underlying fleet value.

While attractive underlying fleet value is not new, the company may shine a light on this embedded value via transactions, Evercore tells investors.

2. BofA Sees "Robust" Growth for Trade Desk, Starts With a Buy

BofA initiated coverage of Trade Desk (TTD) with a Buy rating and a price target of $135. As a leading, independent demand-side platform, or DSP, that has strategically positioned itself within the growing connected TV, or CTV, and Retail Media ad markets, Trade Desk is poised to benefit from anticipated robust growth over the next several years, the firm tells investors.

3. Visa Initiated With a Buy at Compass Point on Value Added Services Penetration

Compass Point initiated coverage of Visa (V) with a Buy rating and a $319 price target. The firm estimates FY25 EPS of $11.16, noting that its view is above consensus FY25 "core" EPS by 1.2% due to faster revenue growth given its value-added services, or VAS, analysis. Compass sees a 15% increase in total net revenue long-term from VAS penetration.

Visa Upgraded to Outperform at Exane BNP Paribas

Additionally, Exane BNP Paribas upgraded Visa to Outperform from Neutral with a $325 price target. The firm says cash digitization has largely played out in the U.S., leaving Visa and MasterCard to compete for potentially limited opportunities in other regions, particularly in Europe. Exane believes Visa screens well versus peers there, with MasterCard looking less attractive. It now expects MasterCard's revenue growth to slow versus Visa's.

4. Wells Fargo Upgraded to Buy at Deutsche Bank

Deutsche Bank upgraded Wells Fargo (WFC) to Buy from Hold with a $65 price target. The stock's recent weakness has created a better entry point, the firm tells investors in a research note. Deutsche believes Wells should see continued benefits from investments in certain businesses such as trading, investment banking, and credit card services.

5. XPeng Upgraded to Overweight at JPMorgan

JPMorgan upgraded XPeng (XPEV) to Overweight from Neutral with a price target of $11.50, up from $8. The company's upcoming new models in Q4 -- Mona M03 and P7 plus -- should increase quarterly deliveries from about 45,000 units in Q3 to about 80,000 in Q4, which will then be followed by full year contribution in 2025, the firm tells investors in a research note. JPMorgan adds that its store visits and test drive of the M03 raises its confidence on Q4 delivery momentum.

Next, here are the top 5 sell calls of the week.

1. Boeing Downgraded to Underweight at Wells Fargo

Wells Fargo downgraded Boeing (BA) to Underweight from Equal Weight with a price target of $119, down from $185. The firm sees the company's free cash flow peaking by 2027 as aircraft development costs offset further production growth, and says an equity raise likely further dilutes the shares.

Boeing had a generational free cash flow opportunity this decade, driven by ramping production on mature aircraft and low investment need, Wells tells investors in a research note. However, after extensive delays and added cost, the firm now sees growing production cash flow running into a new aircraft investment cycle, capping free cash flow a few years out.

Boeing carries $45 billion net debt on its balance sheet, and paying this down would consume all of its cash through 2030, according to Wells.

2. KB Home Downgraded to Underperform at RBC Capital

RBC Capital downgraded KB Home (KBH) to Underperform from Sector Perform with an unchanged price target of $70. The firm's pricing showed another month of weaker relative trends for KB Home.

RBC sees a more negative near-term risk/reward skew for the shares following the 20% rally over the past two months. This is in-light of broader housing macro data remaining soft despite recent rate relief, which presents increased risk to numbers, particularly for orders looking into year-end, the firm tells investors in a research note.

3. Susquehanna Downgrades Evertec to Negative on Margin Pressure

Susquehanna downgraded Evertec (EVTC) to Negative from Neutral with a price target of $28, down from $38. The company is likely to face negative leverage over the next few years, with its lowest margin region Latin America growing the fastest, the firm tells investors in a research note.

Susquehanna believes Evertec's transition to outside the borders of its native Puerto Rico is likely to pressure its margins, potentially moving below levels contemplated by consensus.

4. CME Group Downgraded to Underperform at BofA amid Intensifying Competition

BofA downgraded CME Group (CME) to Underperform from Neutral with a price target of $177, down from $212, citing intensifying competition. CME Group now faces a battle on three fronts with BGC Partners (BGC), Cboe Global Markets (CBOE) and IntercontinentalExchange (ICE), and the competition could lead to market share losses and pricing headwinds, the firm tells investors.

BGC's FMX Futures Exchange is scheduled to launch in some weeks, and the firm expects CME to cut its pricing in interest rate futures by 10%-plus as a defense, BofA added.

5. Terreno Realty Downgraded to Underperform at Mizuho 

Mizuho downgraded Terreno Realty (TRNO) to Underperform from Neutral with an unchanged price target of $62. The Industrial real estate investment trust narrative has recently turned net positive, as many investors believe the worst is behind the sector, the firm tells investors in a research note.

Mizuho says the numbers tell a different story -- that core growth will keep slowing. It believes a lower "new normal" of core earnings growth in fiscal 2026 is underappreciated. The firm cites increasing vacancy in Terreno's submarkets that should limit pricing power and slowing total growth for the downgrade.

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