Notable analyst calls this week: Caterpillar, UnitedHealth and Peloton among top picks

The S&P500 (SP500)closed in the green, after the week saw a soft inflation data and easing trade tension between the U.S. and China.

For the week, Nasdaq (COMP:IND) gained 2%, while Dow (DJI) fell 0.2%.

Wall Street had a slew of upgrades and downgrades from analysts. Here are some of the major calls for the week:

Warner Music Group downgraded after Q2 results

Goldman Sachs downgraded Warner Music Group (NASDAQ:WMG) to Neutral from Buy following its second-quarter earnings report last week.

The brokerage, which cut PT to $28 from $35, noted that subscription and ad-supported streaming revenue growth in Q2 came in below its consensus expectations, driven by weaker-than-expected market share performance and macro-related impacts on advertising.

GS models ~3% YoY CC growth through the rest of the fiscal year, compared to prior expectations of ~7% growth for FY2025 for WMG.

Bank of America sees 10%-20% cut to 2025 outlook for UnitedHealth

Bank of America downgraded UnitedHealth Group (NYSE:UNH) to Neutral from Buy expecting the managed care giant to issue a 10%–20% cut to its 2025 outlook, after it announced the resignation of its former CEO, Andrew Witty, and pulled its full-year guidance, citing a rise in medical activity.

The brokerage also cut PT on the stock to $350 from $560.

“We view the decision to pull the 2025 guide as a combination of uncertainty around the prevalence and persistence of the higher utilization as well as giving the incoming CEO additional time to become comfortable around the 2025 guidance he is now responsible for,” Bank of America analyst Joanna Gajuk said.

Caterpillar upgraded by Wolfe on 2026 recovery

Caterpillar (NYSE:CAT) was upgraded to Outperform from Neutral by Wolfe Research, saying that the maker of heavy equipment and construction machinery defied expectations in the first quarter, signalling a potential turning point.

Multiple drivers are converging to support a recovery in earnings and share price performance heading into 2026, Mig Dobre, analyst at Wolfe Research, said, adding that despite five straight quarters of declining dealer retail sales, recent signs of stabilization are encouraging. Dobre also highlighted easing U.S.-China trade tensions as a catalyst for margin improvement.

Peloton upgraded on improved subscriber metrics

Macquarie upgraded Peloton (NASDAQ:PTON) to Outperform from Neutral, attributing the bullish rating to improved user metrics, an improved subscriber outlook, among others.

“The [free cash flow] trends to date and potential for these to persist into FY26 ultimately provide scope for continued deleveraging and opportune investment in growth,” Macquarie’s Marni Lysaght said, adding despite lower sales and marketing spending, Lysaght sees Peloton’s higher-income demographic more resilient than lower income cohorts, ultimately contributing to a higher lifetime value of subscribers over the cost of acquiring a new subscriber.

Regeneron upgraded; AbbVie downgraded at Citi

Citi upgraded Regeneron (NASDAQ:REGN) and downgraded AbbVie (NYSE:ABBV), citing varying risks for the U.S. pharma majors from the Trump administration’s latest policy moves targeting the industry.

Citi analyst Geoff Meacham upgraded Regeneron to Buy from Neutral, arguing that the Eylea maker’s exposure to policy risks related to tariffs and MFN discounting “seems reasonably controlled to us.” Meacham also raised his PT on REGN to $700 from $600 per share.

Meacham downgraded AbbVie to Neutral from Buy, arguing that despite the company’s strong fundamentals, it faces diminishing share impact from its consistent quarterly raises going forward as investors turn attention to the Humira maker’s pipeline. The analyst slashed his PT to $188 from $205per share.

First Solar downgraded after CEO’s tariff warning

KeyBanc cut First Solar (NASDAQ:FSLR) to Underweight from Sector Weight, after reporting much lower thanexpected Q1 profit and CEO Mark Widmar warning that President Trump’s tariffs “create a significant economic headwind” for its plants in India, Malaysia and Vietnam.

“This uncertainty is pancaked on top of broader anxiety over the fate of various IRA provisions, and we believe will put pressure on valuation in the near term,” KeyBanc Sophie Karp wrote. Oppenheimer and Jefferies also downgraded First Solar after the report.

Wedbush removed Alphabet (NASDAQ:GOOGL) from its Best Ideas List, saying that the tech giant remains compelling on a long-term basis, but volatility in shares introduced by the uncertainty relating to the impact of AI on its business model led the brokerage to remove its shares from the list.

Citi Research upgraded PDD Holdings (NASDAQ:PDD) to Buy from Neutral, saying that the bigger-than-expected and sooner-than-expected tariff reduction is a positive outcome for China cross-border sellers and a positive read-through to Temu U.S. sales. PDD’s PT was hiked to $165, from $127 by Citi.

Super Micro Computer (NASDAQ:SMCI) was in focus after Raymond James started coverage on the artificial intelligence server maker with an Outperform rating, calling it a “near AI pure play.” Analyst Simon Leopold said that SuperMicro is in a “sweet spot” between branded IT suppliers like Dell and HP Enterprise and contract companies like Quanta.