Today's most important upgrades

GoDaddy Inc (NYSE: GDDY) shares surged more than 3% intra-day today after Evercore ISI upgraded the company to Outperform from In Line and raised its price target to $103.00 from $86.00.

The firm mentioned several reasons for the upgrade, including (1) the company’s reasonably recession-resistant business model (Web Presence, Domains & Hosting which combine for almost 80% of GDDY revenue are largely utilitylike services), (2) with the rollout of Payable Domains, the company has an intriguing new product cycle that has the potential to materially boost its ARPU, and (3) unlike many Tech/Internet companies, GoDaddy maintained its cost discipline throughout the Covid period, maintaining OPEX growth consistently below revenue growth, which sets up its business well for a potentially softening demand environment.

Pegasystems (NASDAQ: PEGA) shares were up more than 8% intra-day today after Citi upgraded the company to Buy from Neutral and raised its price target to $45.00 from $36.00, noting it believes the company has an attractive valuation and automation upside.

Gap, Inc. (NYSE: GPS) shares gained more than 2% intra-day today after Morgan Stanley upgraded the company to Equalweight from Underweight with a price target of $12.00, noting that "everything that could go wrong for Gap did go wrong" in 2022, pointing to bloated inventory, assortment mis-execution, management departures, consistent guidance cuts, and more.

"Looking ahead, we expect the rate of change inflects positively from here, & the stock may further enjoy a halo period once a new CEO is announced. Even better, GPS is one of few stocks that may have already bottomed," the firm added.

Seagate Technology (NASDAQ: STX) shares gained more than 3% intra-day today after Morgan Stanley upgraded the company to Overweight from Equalweight and raised its price target to $69.00 from $54.00.

“While STX has been challenged by inventory corrections at customers, COVID lockdowns in China, and weakening consumer demand, we believe now is the time to get more constructive, as we believe we're nearing an HDD industry bottom and soon move to the early cycle period,” the firm added.

By Davit Kirakosyan

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