Wednesday’s analyst calls: Amazon earnings draw praise, 3M finds some support

(This is CNBC Pro’s live coverage of Wednesday’s analyst calls and Wall Street chatter. Please refresh every 20-30 minutes to view the latest posts.) Wednesday’s big market calls saw analysts give mostly rave reviews to Amazon’s earnings beat the day before, with most citing cost-cutting measures and the firm’s utilization of artificial intelligence. Elsewhere, JPMorgan issued a contrarian call on battered 3M shares, saying the industrial products maker offers good value after shares fell sharply this year while the company beat on earnings. Check out the latest calls and chatter below. All times ET. 6:22 a.m.: JPMorgan goes against consensus to upgrade 3M to overweight The tide could be shifting when it comes to 3M , according to JPMorgan. The bank upgraded the maker of industrial products to an overweight rating from neutral. Analyst C. Stephen Tusa also raised his price target to $111 from $110, implying that shares of 3M could rally 15% from here. 3M stock has added nearly 6% so far in 2024, but the stock is still trading at an attractive valuation given the company’s characteristics, Tusa said. “Underlying fundamentals are showing modest improvement and EPS growth is turning, with exposure to bottoming electronics markets,” the analyst wrote. “We also think 3M offers a degree of cheap defense in a potentially more choppy tape, while an increase in rates actually benefits the calculation in discounting the liability burden here, with a balance sheet that is stronger than we think most appreciate given the Solventum dividend and stake.” Tusa also cited 3M’s first-quarter results as a catalyst. The company posted earnings of $2.39 per share on revenue of $7.72 billion, topping analysts’ expectations of $2.10 per share on adjusted revenues of $7.63 billion from the LSEG consensus. 3M also cut its dividend for the first time in 64 years after spinning of its healthcare unit earlier in April. “We acknowledge the unknowns, but think our estimate of a doubling in the current liability burden, the timing around which is unclear, leaves plenty of leeway for upside near term,” Tusa said of the dividend cut catalyst. He added that he’s upgrading 3M while it’s still highly out of favor with Wall Street, with only one other analyst assigning the stock a buy rating. — Lisa Kailai Han 6:14 a.m.: Here’s how Wall Street is reacting to Amazon’s blockbuster first-quarter earnings Amazon released its first-quarter earnings on Tuesday, and the e-commerce platform beat analyst expectations for both its first-quarter earnings and revenue, while its operating income added more than 200%. Amazon’s profit also tripled to 98 cents per share from 31 cents a year ago. Shares of Amazon were up more than 2% in premarket trading. The stock is now 15% higher on the year. After Amazon’s earnings release, the major banks reiterated their optimistic stances around the stock. Barclays, Bank of America, JPMorgan and Morgan Stanley all stood by their overweight-equivalent ratings. Multiple analysts also stated that Amazon was one of its top stock picks. Amongst the group, JPMorgan analyst Doug Anmuth has the highest price target of $240, which implies that Amazon stock could rally another 37% from here. The analysts highlighted Amazon Web Services’ severe cost-reduction measures as a major driver of upside. These cost discipline strategies included more regimented spending and slower headcount growth. Additionally, the Wall Street firms also noted that Amazon’s artificial intelligence tailwinds are finally materializing. “AMZN’s greater capital intensity — which is coming mostly in AWS — is driven by increased demand for cloud services and GenAI. We believe this is positive as AMZN has a very clear path to monetization of infrastructure investments through AWS, & has a track record of favorable returns,” wrote JPMorgan analyst Anmuth. — Lisa Kailai Han — CNBC’s Michael Bloom contributed to this report.