Several notable brokerages adjusted their outlooks this week, highlighting value opportunities and risks across diverse sectors. Below, we break down the key calls on MSM, Cleveland‑Cliffs (CLF), Fair Isaac (FICO), and eXp World Holdings (EXPI)—from upgrades predicated on operational turnarounds to downgrades rooted in sector headwinds.
1. JPMorgan Upgrades MSC Industrial (MSM) to Overweight
What Changed?
JPMorgan moved MSC Industrial (NYSE: MSM) from Neutral to Overweight, citing its long‑standing leverage to improving domestic industrial production. As a leading metalworking distributor, MSM has suffered from sluggish share gains as it shifted from transactional sales to solutions‑based services (e.g., on‑site vending, in‑plant programs, and Vendor Managed Inventory). While these initiatives show promise, core customer growth has lagged due to underinvestment in digital/web capabilities and salesforce execution.
Why Now?
JPMorgan believes several “self‑help” levers are finally aligning:
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Tariff‑Driven Pricing: Higher steel and source costs have bolstered per‑unit pricing.
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End‑Market Improvement: Signs of a pickup in factory activity and capex.
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Dividend Appeal: A 4%+ yield, well above industry peers, offers a defensive cushion while execution plays out.
Analysts view MSM as undervalued on a relative basis. You can track MSM’s evolving broker ratings via the Up‑Down Grades by Company API, and see the latest $40 consensus price target in the Price Target Summary API.
2. GLJ Research Downgrades Cleveland‑Cliffs (CLF) to Sell
What Happened?
GLJ Research’s scathing report cuts Cleveland‑Cliffs (NYSE: CLF) to Sell, slashing its price target to $3.91 (implying nearly 39% downside). The firm outlines five critical headwinds:
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Market‑Share Losses: CLF is ceding share to Nucor (NYSE:NUE) and Steel Dynamics (NASDAQ:STLD), which successfully ramped utilization in Q1 as CLF idled key mills.
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Weak Auto Demand: U.S. car production has declined consecutively for six months, undercutting CLF’s automotive segment optimism.
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Fierce Import Competition: A widening hot‑rolled coil import arbitrage is attracting foreign steel into U.S. markets at lower costs.
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Soft Domestic Economy: Steel seasonality turns bearish into late summer, and broader industrial activity is sluggish.
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Valuation Fragility: An 8.5× 2029E EV/EBITDA estimate—discounted to 2025—leaves scant margin for error unless tariffs spike or China’s economy rebounds unexpectedly.
With GLJ flagging a “sinking ship” narrative, investors should monitor CLF’s capital deployment and any tariff policy shifts. For live updates on CLF’s credit ratings and related broker actions, consult the Bulk Ratings API.
3. Baird Upgrades Fair Isaac (FICO) to Outperform
What Changed?
Baird lifted Fair Isaac (NYSE:FICO) to Outperform with a $1,900 price target, citing a favorable risk/reward after the software company’s pullback on regulatory‑risk concerns. The firm believes that:
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Regulatory Overhang Is Priced In: Potential rule changes around credit‑scoring are now well‑discounted.
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Robust Core Model: FICO’s credit‑scoring algorithms remain deeply embedded across financial institutions, underpinning stable annuity‑style revenues.
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Mortgage Normalization: As U.S. housing volumes stabilize, FICO stands to benefit from both issuance and refinancing activity over the next 12–18 months.
Baird views the current setup as an attractive entry point—balancing conservative near‑term visibility with multi‑year upside tied to disciplined enterprise pricing and an eventual housing normalization.
4. DA Davidson Upgrades eXp World Holdings (EXPI) to Buy
What Happened?
DA Davidson raised eXp World Holdings (NASDAQ: EXPI) to Buy, with a $10.75 target, based on four catalysts:
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U.S. Agent Count Rebound: Proprietary checks show a 0.5% Q/Q increase in agent registrations over the last three weeks, reversing a prior decline and outpacing consensus for a 0.8% drop.
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International Monetization: Q1 2025 international revenues jumped 103% YoY, with gross margins in the high teens—well above the U.S. segment’s 7–8%.
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Improving Margins: As international volume grows to 25% of total revenue, blended gross margins should expand from current levels.
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Strategic M&A Optionality: With a lean balance sheet and strong pivot into virtual brokerage platforms, EXPI is positioned to capture market share from traditional brokerages.
DA Davidson considers EXPI a high‑conviction play on agent growth and margin expansion—provided the company sustains its technology‑driven recruiting model and maintains cost discipline.
Bottom Line: Across these divergent calls, the common thread is execution risk. Investors backing MSM and EXPI must trust management to deliver on self‑help initiatives and agent growth, respectively—while those steering clear of CLF need to be convinced that headwinds will intensify. For FICO, regulatory clarity and core model durability underpin Baird’s confidence in multi‑year outperformance. Wherever you stand, these midweek analyst moves offer clear focal points for positioning ahead of each name’s next catalysts.
