(This is CNBC Pro’s live coverage of Monday’s analyst calls and Wall Street chatter. Please refresh every 20-30 minutes to view the latest posts.) Some of the biggest analyst calls on Monday focused on a dollar store stock and a major U.S. airline. JPMorgan raised its rating on Dollar Tree, citing a better macro setups. Citi also upgraded American Airlines, noting it sees upside of more than 30% over the next 12 months. Check out the latest calls and chatter below. All times ET. 6:20 a.m.: Morgan Stanley downgrades Norfolk Southern, says rail stock is lagging its peers Investors should stay away from Norfolk Southern after the company posted disappointing quarterly results, according to Morgan Stanley. “NSC’s 4Q miss and 2024 commentary reflected similar volume and cost concerns as other Rail prints this season but the gap to peers, modest LT targets and lack of a concrete new plan to get there, leaves current consensus EPS expectations and stock multiple less justifiable than peers, in our view,” analyst Ravi Shanker wrote in a Monday note. Shanker downgraded the stock to underweight from equal weight. His $175 price target — down from $185 — implies 25.3% downside for the stock from Friday’s close. According to the analyst, Norfolk Southern was the worst-performing rail stock in 2023. The company’s operating ratio gap vs. peers has only grown, despite rail stocks overall improving on volumes and other constraints this year, he said. Shanker also noted that Norfolk Southern’s long-term guidance isn’t ambitious, with the higher-end of its guidance over three years failing to get the company up to par with where its peers currently are and where Norfolk Southern was a year ago. The company on Friday reported earnings of $2.83 per share, excluding items. That’s below a $2.87 per share StreetAccount forecast. Shares dropped 1.5% in premarket trading, adding to the stock’s losses of just under 1% so far this year. — Pia Singh 5:57 a.m.: Colgate-Palmolive has upside opportunity this year, according to Raymond James Raymond James is optimistic on Colgate-Palmolive shares following the company’s fourth-quarter earnings and full-year outlook. Analyst Olivia Tong upped her rating to outperform from market perform and set her price target to $91, which implies 9.9% potential upside for the stock. “CL is still in the early innings of improved top and bottom-line growth, balancing contribution from volume vs price, emerging markets vs developed, and across the product portfolio,” Tong wrote in a Monday note. “We see solid potential for CL to continue to drive sales growth ahead of its long-term target ranges and towards the upper end of peers, in turn driving upside in the shares.” Colgate-Palmolive’s efforts on product innovation, premiumization in oral care and opportunity to seize pet category growth as pet company Hills decelerates are part of Tong’s investment thesis on the stock. The company has an “ability to become a consistent compounder again” and regain market share as inflation and currency headwinds are more manageable compared to the past, she added. Shares of the company, which are up about 3.9% so far this year, added 0.7% in premarket trading on Monday. — Pia Singh 5:40 a.m.: JPMorgan upgrades Dollar Tree, citing stronger 2024 macroeconomic setup Due to consumer spending and merchandising headwinds, JPMorgan thinks low-end retailers are in for a better year. Analyst Matthew Boss upgraded Dollar Tree to overweight from neutral. He also raised his price target by $35 to $157, implying roughly 18.3% upside from the stock’s latest close at $132.73. “Said differently, we see 3+ years of multi-price-point “self-help ̇ driving mid-single-digit comps at a mid-teens margin profile at DT with the FDO [Family Dollar] store fleet optimization changing the investment narrative to a potential “win-win ̇ catalyst path in FY24,” Boss wrote in a Monday note. According to the analyst, growth catalysts include the acceleration of 600 Family Dollar planned store closures and a larger total addressable market for Dollar Tree, as well as a fixed price point structure that allows disinflation to be a potential multi-year opportunity for merchandise sales. Shares are up 0.4% in premarket trading. The stock has slid about 6.6% so far this year. — Pia Singh 5:40 a.m.: Citi upgrades American Airlines American Airlines shares are off to a strong start for 2024, and Citi expect even more gains from here. The bank upgraded the airline to buy from neutral, raising its price target to $20 from $14. The new forecast implies upside of 32%. “North America’s network carriers’ diversified revenue streams and solid demand for premium cabin offerings appear to provide them with superior positioning in this post-pandemic environment,” analyst Stephen Trent wrote. “Against this supportive backdrop, American’s ongoing deleveraging focus and continued low capex, along with protracted industry capacity constraints, should continue to support the likes of American Airlines.” American shares are up more than 10% year to date thus far. The stock lagged the broader market in 2023, rising just 8%, while the S & P 500 jumped 24.2%. AAL 1Y mountain AAL in past year — Fred Imbert
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