Selected stock price target news of the day - July 26th, 2024

By: Matthew Otto

Chipotle’s Marginal Q2 Gains Mask Underlying Challenges

Chipotle Mexican Grill’s reported second-quarter results, with an EPS of $0.34 beating the analyst consensus estimate of $0.32 by a $0.02 margin. Revenue for the quarter scraped by at $3 billion, slightly above the expected $2.94 billion.

The temporary return of Chicken Al Pastor helped in contributing an 18% sales increase to nearly $3 billion. Comparable restaurant sales saw a growth of 11.1%, while in-store sales increased by 24% year-over-year. Chipotle experienced an 8.7% rise in transactions, resulting in a restaurant-level margin of 28.9%, just a 140 basis point improvement from the previous year. Digital sales made up 35% of total sales. Additionally, Chipotle managed to open 53 new restaurants, including 46 Chipotlanes.

Looking ahead, Chipotle’s management has provided an optimistic outlook for 2024, expecting mid to high-single-digit growth in comparable restaurant sales. They plan to open 285 to 315 new restaurants, with over 80% featuring a Chipotlane, the company’s drive-thru digital order pick-up lane. Additionally, Chipotle anticipates an underlying effective full-year tax rate between 25% and 27%, excluding discrete items.

Analysts Adjust Price Targets While Maintaining Ratings

Keybanc analyst Eric Gonzalez maintained an Overweight rating but lowered the price target from $68 to $66.
Citigroup analyst Jon Tower maintained a Buy rating yet lowered the price target from $71 to $69.
Raymond James analyst Brian Vaccaro reiterated an Outperform rating while lowering the price target from $70 to $62.5.
Loop Capital analyst Alton Stump reiterated a Hold rating and lowered the price target from $58 to $53.
Evercore ISI Group analyst David Palmer kept an Outperform rating while reducing the price target from $72 to $65.
Deutsche Bank analyst Lauren Silberman maintained a Buy rating but lowered the price target from $72 to $67.
BMO Capital analyst Andrew Strelzik maintained a Market Perform rating and downgraded the price target from $57 to $55.
Goldman Sachs analyst Christine Cho kept a Buy rating, however, lowers the price target from $74.6 to $67.
Truist Securities analyst Jake Bartlett reiterated a Buy rating while lowering the price target from $74 to $69.
Oppenheimer analyst Brian Bittner maintained an Outperform rating and downgraded the price target from $70 to $65.

Which Analyst has the best track record to show on CMG?

Analyst Chris O’cull (STIFEL) currently has the highest performing score on CMG with 20/24 (83.33%) price target fulfillment ratio. His price targets carry an average of 20/24 (83.33%) potential upside. Chipotle Mexican Grill stock price reaches these price targets on average within 106 days.

ServiceNow Surpasses Q2 Earnings Estimates, Raises Full-Year Guidance Amid AI Growth

ServiceNow reported financial results for the second quarter of 2024, announcing an earnings per share of $3.13, surpassing the analyst estimate of $2.82 by $0.31. Revenue for the quarter came in at $2.63 billion, exceeding the consensus estimate of $2.6 billion. Subscription revenues reached $2.542 billion, reflecting a 23% year-over-year increase at constant currency, surpassing the high end of their guidance range. Remaining performance obligations (RPO) totaled approximately $18.6 billion, with a 31.5% year-over-year growth, while current RPO stood at $8.78 billion, representing a 22.5% increase.

ServiceNow achieved an operating margin of over 27%, 250 basis points above their guidance, and closed 88 deals exceeding $1 million in net new annual contract value (ACV), marking a 26% growth year-over-year. Notably, the quarter saw six new logos, including two Global 2000 customers, and 14 deals over $5 million in net new ACV.

ServiceNow’s Gen AI initiatives demonstrated progress, with NowAssist net new ACV doubling quarter-over-quarter. The product signs 11 deals with over $1 million in net new ACV, two of which exceeded $5 million..

ServiceNow raised its full-year guidance, projecting subscription revenues between $10.575 billion and $10.585 billion, reflecting 22% year-over-year growth. Also increased its operating margin target to 29.5%, up from 29%, maintaining a subscription gross margin of 84.5% and a free cash flow margin of 31%.

Analysts Adjust Price Targets Following Q2 Results

JMP Securities analyst Patrick Walravens maintained a Market Outperform yet raised the price target from $825 to $850.
TD Cowen analyst Derrick Wood maintained a Buy, while increasing the price target from $870 to $900.
Wells Fargo analyst Michael Turrin reiterated an Overweight and boosted the price target from $920 to $935.
Deutsche Bank analyst Brad Zelnick kept a Buy and elevated the price target from $875 to $900.
RBC Capital analyst Matthew Hedberg reiterated an Outperform; consequently, raised the price target from $850 to $880.
BMO Capital analyst Keith Bachman held an Outperform and raised the price target from $830 to $860.
Truist Securities analyst Joel Fishbein kept a Hold rating and raised the price target from $750 to $780.
JP Morgan analyst Mark Murphy maintained an Overweight, thus increasing the price target from $780 to $820.
Stifel analyst Brad Reback maintained a Buy and adjusted the price target from $820 to $900.
Piper Sandler analyst Rob Owens maintained an Overweight and revised the price target from $830 to $850.

Which Analyst has the best track record to show on NOW?

Analyst Gregg Moskowitz (MIZUHO) currently has the highest performing score on NOW with 28/29 (96.55%) price target fulfillment ratio. His price targets carry an average of $53.31 (6.95%) potential upside. ServiceNow stock price reaches these price targets on average within 126 days.

IBM Beats Q2 Estimates and Raises Full-Year Free Cash Flow Guidance

IBM delivered strong Q2 results, reporting an EPS of $2.43, exceeding the analyst estimate of $2.17 by $0.26. Revenue for the quarter came in at $15.8 billion, surpassing the consensus estimate of $15.62 billion.

Financial performance, noted a 4% revenue growth at constant currency and a 17% increase in operating pre-tax income. IBM’s execution was further demonstrated by a 200 basis point expansion in operating pre-tax margin. Free cash flow generation reached $4.5 billion in the first half of the year.

Looking ahead, IBM continues to forecast constant currency revenue growth in line with its mid-single digit model. However, expects current foreign exchange rates to present a one to two-point headwind to revenue growth. IBM has raised its full-year free cash flow guidance, now anticipating over $12 billion.

Analyst Upgrades: Price Targets Raised Across the Board

RBC Capital analyst Matthew Swanson maintained an Outperform rating and raised the price target from $200 to $211.
Jefferies analyst Brent Thill maintained a Hold rating and increased the price target from $190 to $200.
BMO Capital analyst Keith Bachman maintained a Market Perform rating and raised the price target from $190 to $210.
Stifel analyst David Grossman maintained a Buy rating and raised the price target from $190 to $205.

Which Analyst has the best track record to show on IBM?

Analyst Brent Thill (JEFFERIES) currently has the highest performing score on IBM with 1/2 (50%) price target fulfillment ratio. His price targets carry an average of $29.6 (16.41%) potential upside. International Business Machines stock price reaches these price targets on average within 20 days.