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Investing.com -- Here is your Pro Recap of the top takeaways from Wall Street analysts for the past week.
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Rivian Automotive
What happened? On Monday, BofA downgraded Rivian Automotive Inc (NASDAQ:RIVN) to Underperform with a $10 price target.
*TLDR: Rivian faces softer outlook, rising competition. EV demand slows.
What’s the full story? Rivian remains one of the most viable startup EV makers, inching toward sustainable gross margins. Yet, BofA notes a softer-than-expected 2025 outlook, with the recent Volkswagen (ETR:VOWG_p) partnership muddying earnings visibility for years. Competition looms larger, with a wave of new SUV/CUV models set to hit the market by 2026/2027. Meanwhile, EV demand softens, and potential cuts to U.S. incentives under a Trump administration could pose risks, including to Rivian’s $6.6 billion Department of Energy loan secured in early 2025.
The analysts see challenges to Rivian’s volume trajectory. A slower-than-expected ramp for the R2 platform and a crowded EV SUV/CUV market could weigh on growth. Lucid’s Gravity SUV, Scout’s Traveler SUV and Terra Truck, GM’s Chevrolet Blazer EV, and Ford’s Skunkworks CUV—all arriving by 2027—threaten to undercut Rivian on price, with Scout’s base models starting below $60,000.
While Rivian’s position in the EV space remains strong, navigating these headwinds will require precision and agility.
Tempus AI
What happened? On Tuesday, JPMorgan downgraded Tempus AI Inc (NASDAQ:TEM) to Neutral with a $55 price target.
*TLDR: Tempus AI raises 2025 revenue forecast. JPMorgan downgrades stock, citing overvaluation.
What’s the full story? Tempus AI reported Q4 results aligning with its pre-announced guidance, though revenue slightly missed expectations due to non-core business weakness. JPMorgan notes Tempus raised its 2025 revenue forecast to $1.24 billion, up from $1.23 billion, incorporating Ambry’s 11-month contribution following its Feb. 3rd acquisition. Adjusted EBITDA is now projected at $5 million for 2025, a shift from prior messaging around achieving positive EBITDA on an aggregate basis. TEM’s core business is expected to grow 30% year-over-year, driven by ASP tailwinds in genomics and strong momentum in Data & Services, where Insights revenue surged 66% in Q4. Ambry is forecasted to grow in the high teens annually.
Reinforced by sustainable Data & Service revenue and encouraging ASP traction, Tempus’ 2025 outlook appears robust. However, JPMorgan highlights the stock’s 106% year-to-date surge—far outpacing the XLV’s 7% gain—fueled by AI headlines and political interest, notably Nancy Pelosi’s call option activity. At ~11x 2025 EV/Sales (or ~10x including Ambry), Tempus trades at a premium to the Diagnostics group average of ~6x.
While JPMorgan acknowledges TEM’s unique diagnostics-data synergy, the analysts view the stock as fully valued after its recent rally, downgrading to Neutral and raising its December 2025 price target to $55 from $50 on updated DCF assumptions. The move reflects caution amid valuations detached from fundamentals.
Krispy Kreme
What happened? On Wednesday, Morgan Stanley (NYSE:MS) downgraded Krispy Kreme Inc (NASDAQ:DNUT) to Underweight with a $6 price target.
*TLDR: Morgan Stanley downgrades stock amid volatile forecasts. Analysts seek clarity on sustainable demand drivers.
What’s the full story? Morgan Stanley acknowledges a reactive stance as the stock plunges 22% today, with 2025 guidance falling well below expectations. While some may view this as de-risking forecasts, the analysts caution that similar assurances have preceded persistent challenges in hitting targets, reinforcing their cautious bias. A recent cybersecurity incident has introduced short-term disruptions, but the focus remains on broader demand indicators and the company’s strategy to address them.
The analysts note that multiple elements of the company’s narrative remain too volatile for comfort, prompting a relative underweight (UW) rating in their coverage. Morgan Stanley seeks greater clarity on sustainable demand growth drivers in the U.S. before reconsidering their position. Until then, the firm maintains a guarded outlook, emphasizing the need for more consistent operational execution and demand visibility.
Goldman Sachs
What happened? On Thursday, Keefe Bruyette & Woods downgraded Goldman Sachs Group Inc (NYSE:GS) to Market Perform with a $660 price target.
*TLDR: KBW downgrades Goldman Sachs on high valuation. Risks outweigh near-term upside.
What’s the full story? KBW downgrades Goldman Sachs shares to Market Perform, citing elevated valuation and a balanced risk/reward outlook. The firm acknowledges catalysts such as a robust trading environment, improving investment banking conditions, restructuring of its consumer business, and margin growth in Asset Management. Yet, Goldman’s valuation sits at its peak, facing potential headwinds from market uncertainties tied to tariffs, inflation, interest rates, and government policies. These factors, coupled with a weak start to the year in investment banking, have fueled a rotation away from capital market stocks.
Despite underperforming the BKX by 200 basis points over the past five days, Goldman has vastly outperformed since late 2022, gaining 70%. This rally has pushed its valuation to nearly 2x tangible book value, a significant premium to its historical 1.2x. KBW sees limited upside from here, arguing that expectations may have overshot current realities. Goldman remains a formidable player, but the firm’s risk/reward profile now leans more neutral than compelling.
Cava Group
What happened? On Friday, Piper Sandler upgraded CAVA Group Inc (NYSE:CAVA) to Overweight with a $115 price target.
*TLDR: Piper upgrades CAVA, seeing value in volatility. They bet on fast casual growth.
What’s the full story? Piper upgrades CAVA to Overweight from Neutral, seeing opportunity amid recent volatility. The analysts are bullish on the secular growth of fast casual, and CAVA stands out as a prime way to capitalize on the trend. Despite a choppy environment and uncertainty around consumer behavior in the restaurant sector, Piper views the current weakness as a buying window. CAVA shares are down roughly 20% year-to-date and 33% this month, offering an attractive entry point.
While growth stocks have broadly retreated, Piper is deliberate in selecting CAVA, confident in its ability to weather near-term turbulence and deliver long-term value.