In this article, we will discuss the Top 10 Newsworthy Upgrades and Downgrades.
With tariffs, trade wars, and real wars upending the global economy, the path of equity markets is still uncertain as we enter H2 2025, according to Capital Group, the leading active fund manager. Cheryl Frank, an equity portfolio manager for American Mutual Fund and CGCV — Capital Group Conservative Equity ETF, believes that as the new trade landscape comes into focus, the broader markets may stabilize, and a new set of investment opportunities is likely to emerge.
Domestic Companies Likely to Provide Shelter
The fund manager believes that multinationals are not the only potential winners in the current environment. There are domestic companies that are positioned to mitigate an uncertain environment. For example, the new growth potential was visible in the utilities sector. Also, domestic utilities are not subject to the Trump administration’s tariffs, and the sector is known to provide stability amidst downturns.
As per Frank, the risks to the broader economy and markets have increased. That being said, the portfolio manager believes that opportunities are broadening too. For long-term investors, it is important to seek balance in portfolios and maintain flexibility.
Amidst such trends, let us now have a look at the top 10 newsworthy upgrades and downgrades.
A financial planner carefully scrutinizing company’s investment portfolio.
Our Methodology
To list the Top 10 Newsworthy Upgrades and Downgrades, we sifted through several online rankings to get a list of stocks that were recently upgraded and downgraded. Next, we chose the ones that are popular among hedge funds. Finally, the stocks were arranged in ascending order of their hedge fund sentiments, as of Q1 2025.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
Top 10 Newsworthy Upgrades and Downgrades
10. LG Display Co., Ltd. (NYSE:LPL)
Number of Hedge Fund Holders: 2
LG Display Co., Ltd. (NYSE:LPL) is one of the stocks that made it to our list of top 10 newsworthy upgrades and downgrades. On June 11, Morgan Stanley upped the company’s stock to “Equal Weight” from “Underweight” with a price objective of KRW 9,500, up from the prior target of KRW 8,600, as reported by The Fly. As per the firm, the weak end markets and an uncertain cyclical outlook have been de-risked in valuation and earnings. Furthermore, it expects that a strong OLED contribution and fixed cost reduction will drive a turn to profit and improved earnings from Q3 2025 onwards.
As the market for LCD panel-based products reached a maturity stage, LG Display Co., Ltd. (NYSE:LPL) believes that the increased adoption of OLED panels throughout numerous segments, aided by their differentiated advantages, can help create new opportunities. The display panel industry is anticipated to continue to grow. LG Display Co., Ltd. (NYSE:LPL) continues to strengthen its business competitiveness based on customer value and developing new markets under the strategic plan to pivot its business to center around OLED, which possesses robust growth potential in the display panel industry.
Coming to the large-sized display panels, the company continues to focus on expanding the OLED market via differentiated products and technology and strengthening business with new customers.
9. CONMED Corporation (NYSE:CNMD)
Number of Hedge Fund Holders: 23
CONMED Corporation (NYSE:CNMD) is one of the stocks that made it to our list of top 10 newsworthy upgrades and downgrades. Needham downgraded the company’s stock from “Buy” to “Hold,” with the firm highlighting concerns related to its slowing growth trajectory. The research firm cited reduced long-term growth rates, mainly in Conmed’s AirSeal and Buffalo Filter product lines, as the factors responsible for the downgrade. The slower revenue growth can result in more gradual margin improvement and lower EPS growth.
As per the firm, the downgrade was seen because CONMED Corporation (NYSE:CNMD)’s valuation has shifted as compared to its peers. The firm stated that it previously defended CONMED Corporation (NYSE:CNMD)’s stock when it traded at a discount to peers. However, the firm noted that small and mid-cap GARP peers witnessed a contraction in their P/E multiples. The company expects revenue currency headwinds of ~50 bps – 70 bps as compared to 100 bps – 120 bps previously. CONMED Corporation (NYSE:CNMD) anticipates reported revenue of between $1.350 billion – $1.378 billion in FY 2025 as compared to previous guidance of $1.344 billion – $1.372 billion.
CONMED Corporation (NYSE:CNMD) is a medical technology company that develops, manufactures, and sells devices and equipment for surgical procedures.
8. Joby Aviation, Inc. (NYSE:JOBY)
Number of Hedge Fund Holders: 23
Joby Aviation, Inc. (NYSE:JOBY) is one of the stocks that made it to our list of top 10 newsworthy upgrades and downgrades. On June 12, Cantor Fitzgerald downgraded the company’s stock to “Neutral” from “Overweight” with a price objective of $9, as reported by The Fly. This downgrade comes after the recent share price rally and a lack of upside potential over the near term. Over the past month, the company’s stock has seen a run-up of ~29%. However, the firm still believes that Joby Aviation, Inc. (NYSE:JOBY) is one of the best-positioned companies in the eVTOL sector.
As per the firm, Joby Aviation, Inc. (NYSE:JOBY)’s valuation now looks stretched, and it doesn’t see current levels as a good entry point. Furthermore, while the firm believes that Joby Aviation, Inc. (NYSE:JOBY) has the strongest liquidity position, it also opines that the company has the highest cash burn in the broader industry. The company’s operating expenses in Q1 2025 amounted to $163.3 million and reflected costs to support its certification and manufacturing of the aircraft. Joby Aviation, Inc. (NYSE:JOBY) ended Q1 2025 with $813 million in cash and short-term investments. It excludes the additional $500 million commitment from Toyota.
Joby Aviation, Inc. (NYSE:JOBY) is a vertically integrated air mobility company.
7. Venture Global, Inc. (NYSE:VG)
Number of Hedge Fund Holders: 24
Venture Global, Inc. (NYSE:VG) is one of the stocks that made it to our list of top 10 newsworthy upgrades and downgrades. On June 12, UBS downgraded the company’s stock from “Buy” to “Neutral,” while increasing the price objective to $18.00 from the prior target of $14.00. The firm believes that the stock now possesses a limited upside potential due to the recent stock price appreciation. Notably, Venture Global, Inc. (NYSE:VG)’s stock has seen a run-up of over ~65% in just one month. The higher valuation multiple reflects that investors have already priced in much of its improved performance outlook.
Despite the downgrade, the firm has a constructive long-term view of Venture Global, Inc. (NYSE:VG). UBS believes that the fundamentals of the company are likely to remain strong. Overall, the downgrade is mainly valuation-driven. Venture Global, Inc. (NYSE:VG) saw a healthy Q1 2025 in terms of both project execution and financial performance. The company generated revenue of ~$2.9 billion, reflecting an increase of 105% YoY. The company’s first facility, Calcasieu Pass, achieved Commercial Operation Date, commencing the delivery of U.S. LNG to the project’s long-term customers.
Sands Capital, an investment management company, released its Q1 2025 investor letter. Here is what the fund said:
“Venture Global, Inc. (NYSE:VG) specializes in the development and operation of liquefied natural gas (LNG) export facilities along the U.S. Gulf Coast. We believe natural gas demand is likely to continue growing over the next several decades as an abundant, affordable, reliable, highly scalable, and relatively clean energy source relative to other hydrocarbons. Given the fundamental mismatch between where the world’s largest and cheapest natural gas resources are located (primarily the United States and the Middle East) versus key areas of demand growth (Asia), we expect LNG demand to grow even faster while becoming increasingly critical from a global energy security perspective. Against this backdrop, we expect that Venture Global’s modular approach to facility development will enable the company to capture a disproportionate share of incremental demand. Its innovative approach meaningfully compresses construction timelines, reduces capital intensity and operating costs, and, we believe, facilitates a virtuous cycle that can allow for project cash flows to be generated and reinvested much faster and more effectively than for its peers. As a result, we see a runway for Venture Global to sustain above-average growth as it profitably expands its production over the next decade.”
6. TransAlta Corporation (NYSE:TAC)
Number of Hedge Fund Holders: 29
TransAlta Corporation (NYSE:TAC) is one of the stocks that made it to our list of top 10 newsworthy upgrades and downgrades. On June 12, Jefferies upgraded the company’s stock to “Buy” from “Hold,” increasing the price objective to C$20 from the previous target of C$12, as reported by The Fly. Jefferies highlighted that the company is expected to benefit from increased power prices in Alberta, Canada. This upgrade stems from the more tangible evidence of durably higher AESO (Alberta Electric System Operator) power prices after the large load integration in the 2027/2028 time frame, added the firm. Jefferies noted that it was earlier hesitant to underwrite increasing AESO power prices.
However, it gained confidence to raise the assumptions based on indications from AESO power price forwards and talks with local stakeholders. It acknowledged that these forward markets can be admittedly illiquid at times. While TransAlta Corporation (NYSE:TAC)’s merchant portfolio in Alberta was partially impacted by softness in power prices in Q1 2025, its hedging strategy and active asset optimization generated realized prices well above spot prices.
The company advanced its growth plan by securing a strategic partnership with Nova Clean Energy, LLC, granting TransAlta Corporation (NYSE:TAC) the exclusive option to purchase late-stage development projects in the western United States.
TransAlta Corporation (NYSE:TAC) is engaged in the development, production, and sale of electric energy.
5. Conagra Brands, Inc. (NYSE:CAG)
Number of Hedge Fund Holders: 39
Conagra Brands, Inc. (NYSE:CAG) is one of the stocks that made it to our list of top 10 newsworthy upgrades and downgrades. On June 12, Bank of America downgraded the company’s stock to “Underperform” from “Neutral,” reducing the price objective to $20 from the prior target of $27, as reported by The Fly. The firm warned about the increasing protein costs, which can pressure margins and earnings over the upcoming year. Its detailed cost of goods estimates exhibit that protein inflation for chicken, beef, and pork can be a significant headwind.
As per the analysts, Conagra Brands, Inc. (NYSE:CAG) is exposed to unique challenges in the packaged food heading into FY 2026, considering its inflation basket within COGS (protein), along with the limited additional pricing power in the company’s largest category. In Q3 2025, Conagra Brands, Inc. (NYSE:CAG)’s net sales fell 6.3% to $2.8 billion. This reflects a 5.2% decline in organic net sales, a 0.7% decline from the unfavorable impact of foreign exchange, and a 0.4% decrease from the unfavorable impact of M&A.
Notably, the decrease in organic net sales was because of a 2.1% negative impact from price/mix and a 3.1% decline in volume.
Conagra Brands, Inc. (NYSE:CAG) operates as a consumer packaged goods food company.
4. CF Industries Holdings, Inc. (NYSE:CF)
Number of Hedge Fund Holders: 42
CF Industries Holdings, Inc. (NYSE:CF) is one of the stocks that made it to our list of top 10 newsworthy upgrades and downgrades. On June 12, Wolfe Research downgraded the company’s stock from “Outperform” to “Peer Perform.” This comes after a recent appreciation in the company’s stock, which now reflects a limited upside potential. Notably, the company’s stock has increased by over ~10% in a month. The firm opines that the balance between risk and reward for CF Industries Holdings, Inc. (NYSE:CF) is currently balanced, while there are worries about the risks associated with narrowing natural gas spreads, mainly in H2 of the year.
Despite the downgrade, the firm continues to recognize CF Industries Holdings, Inc. (NYSE:CF) as a leading global natural gas producer, lauding its healthy FCF profile. Net sales in Q1 2025 came in at $1.66 billion as compared to $1.47 billion in Q1 2024. The average selling prices for most of the company’s major products were higher in Q1 2025 compared to Q1 2024, with higher global energy costs increasing the global market clearing price needed to meet demand. In the near term, CF Industries Holdings, Inc. (NYSE:CF) anticipates that the supply-demand balance is expected to remain constructive because of projected healthy demand from the global corn stocks-to-use ratio touching its lowest level since 2013, below average inventories, as well as tough production economics in Europe.
CF Industries Holdings, Inc. (NYSE:CF) is engaged in the manufacturing and selling of hydrogen and nitrogen products for energy, fertilizer, emissions abatement, and other industrial activities.
3. Tapestry, Inc. (NYSE:TPR)
Number of Hedge Fund Holders: 73
Tapestry, Inc. (NYSE:TPR) is one of the stocks that made it to our list of top 10 newsworthy upgrades and downgrades. On June 12, TD Cowen upgraded the company’s stock from “Hold” to “Buy,” lifting the price objective to $100 from the prior target of $90. The upgrade follows the ongoing brand strength of Coach and survey results, which have exhibited robust brand recognition and consumer preference. As per the firm, Tapestry, Inc. (NYSE:TPR)’s global growth strategy and customer data platform continue to enhance its marketing effectiveness.
Following the recent meeting with Tapestry, Inc. (NYSE:TPR)’s management, the firm demonstrated increased optimism about the sustainability of Coach’s growth and pricing strategies of Tapestry, Inc. (NYSE:TPR). In Q3 2025, the company delivered revenue of $1.6 billion, reflecting an increase of 7% as compared to the prior year, aided by Coach Brand Growth of 13%. The company saw healthy growth in handbag revenue and a mid-teens percentage rate AUR (average unit retail) gain at Coach, demonstrating compelling innovation and broad-based traction throughout the leather goods offering.
Tapestry, Inc. (NYSE:TPR) expects revenue of ~$6.95 billion in FY 2025, demonstrating growth of 4% as compared to the prior year on a reported basis. This includes an expected currency headwind of ~50 bps. This was ahead of the previous guidance of ~3% growth YoY.
Tapestry, Inc. (NYSE:TPR) is engaged in providing luxury accessories and branded lifestyle products.
2. Arista Networks Inc (NYSE:ANET)
Number of Hedge Fund Holders: 75
Arista Networks Inc (NYSE:ANET) is one of the stocks that made it to our list of top 10 newsworthy upgrades and downgrades. On June 11, BNP Paribas Exane analyst Karl Ackerman downgraded the company’s stock to “Neutral” from “Outperform,” reducing the price objective to $106 from the previous target of $109. As per the firm, there are higher competitive pressures from Nvidia and low-cost whitebox vendors like Celestica and Accton. The firm opines that such new threats can take market share away from Arista Networks Inc (NYSE:ANET) in the AI networking space. Furthermore, the firm’s analyst believes that Arista Networks Inc (NYSE:ANET) is less appealing as compared to Nvidia, as the latter boasts a better profile and a lower valuation.
The analyst noted that the AI networking market continues to shift from InfiniBand to Ethernet, and Nvidia and other companies are well-placed to dominate such segment. However, Arista Networks Inc (NYSE:ANET) stated that AI, cloud, and enterprise customers have been driving network transformation. The company exceeded $2 billion in revenue for the first time in Q1 2025 despite the challenges related to tariffs. For Q2 2025, Arista Networks Inc (NYSE:ANET) expects revenue of ~$2.1 billion.
Renaissance Investment Management, an investment management company, released its Q1 2025 investor letter. Here is what the fund said:
“Arista Networks Inc (NYSE:ANET) dropped after reporting in-line forward guidance, leading to increasing questions around the sustainability of capital investments that have driven the company’s growth. While we were disappointed with Arista’s stock reaction, we remain encouraged by strong demand for the company’s data center switching products, which remain essential to the secular growth of cloud computing.”
1. Datadog, Inc. (NASDAQ:DDOG)
Number of Hedge Fund Holders: 84
Datadog, Inc. (NASDAQ:DDOG) is one of the stocks that made it to our list of top 10 newsworthy upgrades and downgrades. On June 12, Wolfe Research upgraded the company’s stock to “Outperform” with a price objective of $150. As per the firm, the company seems to be better positioned to benefit from increased demand for AI-related tools than was thought earlier. The upgrade comes after Datadog, Inc. (NASDAQ:DDOG)’s DASH user conference, where the firm analysts stated that customer feedback and new product announcements hinted at improved sentiments.
The survey of Datadog, Inc. (NASDAQ:DDOG)’s customers revealed that while there are some optimization pressures, these are roughly in line with last year and are being offset by higher usage and platform consolidation. The firm mentioned new partnerships and product updates, which include AI-focused tools, as signs that Datadog, Inc. (NASDAQ:DDOG) continues to expand offerings over and above the core monitoring and observability software. Overall, the firm opines that Datadog, Inc. (NASDAQ:DDOG)’s stock looks more attractive given the revised growth outlook.
The company announced new agentic AI monitoring and experimentation capabilities to provide companies with end-to-end visibility, rigorous testing capabilities, and centralized governance of in-house and third-party AI agents.
Datadog, Inc. (NASDAQ:DDOG) operates an observability and security platform for cloud applications.
While we acknowledge the potential of DDOG to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than DDOG and that has 100x upside potential, check out our report about this cheapest AI stock.
READ NEXT: 13 Cheap AI Stocks to Buy According to Analysts and 11 Unstoppable Growth Stocks to Invest in Now
Disclosure: None.
