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Stock ratings: Mizuho boosts SoFi, BTIG warns on Lyft, Raymond James cuts La-Z-Boy

Yahoo Finance Live anchors break down some analyst ratings on trending stocks.

Video transcript


JULIE HYMAN: All right, we got some calls of the day for you today. I was dancing to the music, starting with SoFi. Mizuho's Dan Dolev is citing, quote, "several key positives" for SoFi, following Biden's student debt forgiveness announcement. He's reiterating his buy rating on the stock. He said, the moratorium ends roughly in line to slightly ahead of management's plans. In other words, SoFi had been saying that it would end in January. It's ending in December. This could potentially drive an increase in refi demand, as was the case in the fourth quarter of 2021.

So, just to be clear here-- and this is something that we've been sort of trying to piece through-- the forgiveness effects debt, student debt that is held in public entities, not in SoFi-- it's only if you consolidate your debt in a private lender like SoFi.

So what this is suggesting, I believe what Dolev is suggesting, this will then-- once people are paying again, they will begin to refinance and consolidate the debt, which will drive demand for SoFi services if I'm understanding this whole issue correctly. Dolev, by the way, has got a buy rating on the stock. And this price target is $8 per share. The stock's up a little bit today. It really did get a big lift yesterday when the news came out.

BRAD SMITH: Yeah, the thesis makes sense, too, considering it's 20k that is primarily being forgiven there. And then now it just-- given the amount of debt that so many people own, I mean, we were talking about among upwards of 44 million borrowers that there was $1.7 trillion in excess, an average of about 30 to 40k that everybody was holding. So even if you start to refi that last bit of what you have in debt in student loan debt, then SoFi could perhaps be the beneficiary there.

JULIE HYMAN: And a very quick shoutout to our Ronda Lee, who has been all over this issue. Please check out her stories on Ronda Lee has been all over this and helped explain some of these issues to me and to us.

BRIAN SOZZI: Thank you, Ronda. All right, we're also watching shares of Lyft after BTIG said the ride hailing giant is on track with its third quarter guidance, but warned of slower underlying growth to come. So the company-- they're out here, BTIG, with a buy rating, $25 price target. Of course, that is above current levels, looking in-- I'm looking at one of the polls they did of 1.2 million US consumers.

Said they tracked rides, average selling prices and sales for Lyft on a quarter-to-day basis. Rides are tracking up 15%. Average selling prices down-- excuse me-- down 5% and sales up 9%. So overall, BTIG is saying this is relatively in line with Lyft's guidance. Now is it an acceleration versus what Lyft saw in the second quarter? No, it doesn't look like to be that case. But still doesn't appear that things have decelerated, which, in this case, looks to be good.

BRAD SMITH: I think within the market, it's also the consideration of how you have some of the tiers that have re-entered back in to the competitive landscape as well, Uber bringing back the pool in select cities and in most cities at this point by now. And so for Lyft, because they are so domestically focused and have tried to build out where else their service can really add on or have partnerships to add on that would compete better with an Uber, I think that's exactly where that does continue to be kind of the bearish case that's out there because it's so domestically focused. It's partnership-based as well.

And then in the actual rate that they would be able to profit off of, the amount that drivers are getting has been in high scrutiny, especially over the course of them operating throughout the pandemic. And now them also having to pass through costs to the consumer because of gas prices as well, I think that's exactly where the bearish case continues to make its case known, or at least, have some viability right now, too.

BRIAN SOZZI: I'm just happy to see that prices for my Ubers and Lyfts are going down just a little bit, just a little bit, and I'm all for it. I dig it.

BRAD SMITH: Yeah, well, anybody should want them to go down. Let's also talk about La-Z-Boy here, too. La-Z-Boy getting a downgrade from Raymond James today from outperform to market perform, citing a slowdown in housing data and an uptick in inventory as key catalysts here.

We were just talking about some of the results that we had seen from La-Z-Boy, particularly as the note had pointed out here, the stock close to their prior target price. Near-term estimates coming down. They feel like now is the time to just move to the sidelines. And they're waiting for improvement in some of the trends that I just mentioned in there a moment ago.

Homebuilder sentiment, that is down. It's continued to move lower for about eight months now at this point. And so if you have less people moving into those new homes, less furnishings necessary to actually make the house a home, if you will.

BRIAN SOZZI: Two of the things that surprised me this week, amongst many things in markets in life, one, Pottery Barn sales up 21.5%. And La-Z-Boy crushed it as well. I mean, those are just blowout numbers in an economy that has clearly slowed, and people are pulling back on these items.

JULIE HYMAN: Here's some more anec data for you. I wanted to order a new mirror for my powder room redo from West Elm. Not deliverable till December, the particular one I was looking at.

BRIAN SOZZI: Did you order it?

JULIE HYMAN: I didn't order it yet. I'm--

BRIAN SOZZI: Yeah, but you're going to.

JULIE HYMAN: Well, I'm going to look around and see if I can get something more timely. I mean, it's just that these delays are still-- there are still pockets where that stuff is still happening. And there's not piling up inventory everywhere, which is interesting to me.

BRIAN SOZZI: I don't own a home. Is a powder room different than the bathroom? So this is a powder room.

BRAD SMITH: It's a half bath.

JULIE HYMAN: The powder room is the half bath--

BRIAN SOZZI: Powder room, half bath.

JULIE HYMAN: --that people-- the guests use.

BRIAN SOZZI: Julie, more--


BRIAN SOZZI: --more things I learned this week.