Amazon slips in premarket trading; Frontier Group, SailPoint rise

Investing.com -- PepsiCo (NASDAQ:PEP) stock rose 4% following a Wall Street Journal report that activist investor Elliott Investment Management has acquired a roughly $4 billion stake in the beverage and snacks giant.

According to the report, Elliott plans to push for changes at PepsiCo to boost its lagging share price. The activist fund now ranks among the company’s top five active investors, excluding index funds.

The beverage maker has faced challenges in recent quarters, struggling to win back soda drinkers after losing market share to competitors. Additionally, its food business, which was previously a growth driver, has come under pressure.

While Elliott has established this substantial position in PepsiCo, the specific changes the activist investor plans to advocate for remain unclear, according to the report.

Elliott’s stake in PepsiCo represents one of the activist firm’s largest equity positions ever taken, signaling a potentially significant campaign to influence the company’s strategic direction.

Investing.com -- The summer rally in U.S. equities, built on strong corporate earnings, declining Treasury yields, and subdued oil prices, faces critical tests in the weeks ahead, according to Raymond James.

In a research note, the firm highlighted that “this rally is built on low oil prices, declining Treasury yields, and steady labor market.”

“All 3 of these will be tested post-Labor Day as Russia/Ukraine continues, another month of jobs data is revealed, and the bond market digests an Appeals court ruling against the legality of some of President Trump’s tariffs,” wrote Raymond James analysts.

The firm said global equities have been in a rising asset environment since April, with “nearly every equity index at all-time highs, credit spreads near record lows, [and] non-equity assets at all-time highs.” 

The backdrop, it noted, has been supported by “impressive corporate earnings results and 10-year Treasury bond yields that have trended down as the bond market has not reacted to the modest evidence of tariff induced inflation.”

The analysts also flagged skepticism around artificial intelligence stocks, noting that while capex at major cloud companies continues to expand, “the performance of AI stocks faded in late August as the market broadened” amid concerns about underwhelming new models and an MIT report suggesting many AI projects are failing.

Looking ahead, Raymond James pointed out that earnings growth across midcap and small-cap indexes is expected to accelerate in late 2025 and into 2026. Still, it cautioned: “The earnings expectations setup remains for broadening, but it was a year ago too.”

Investing.com -- Morgan Stanley reshuffled its cybersecurity stock calls, upgrading SailPoint and Zscaler to Overweight while downgrading Fortinet to Underweight.

The bank lifted SailPoint on the back of its leadership in the identity governance market, where it commands around a 22% share.

Analysts cited a 28% annual recurring revenue (ARR) compound annual growth rate (CAGR) from fiscal year 2023 (FY23) to FY26, driven by SaaS transition and “multi-billion dollar legacy replacement opportunity.”

The company has shown early success expanding beyond core identity governance, with contributions from Machine Identity, Data Access Security and Non-Employee Risk Management more than doubling year-on-year.

“SailPoint appears well-positioned to sustain 20%+ ARR growth moving forward,” analysts led by Meta A. Marshall wrote. The stock’s price target was raised to $25 from $16.

Zscaler was also upgraded, with Morgan Stanley pointing to its strong positioning in the $34 billion SASE market, expected to grow at a 24% CAGR.

The bank said Zscaler “could cement itself as the next true platform,” highlighting its expansion beyond network security and into AI-driven security through the Red Canary acquisition.

While the stock is already up 50% year-to-date and trades at a premium, the analysts argue “there continues to be a meaningful opportunity, particularly vs. other opportunities within Cybersecurity.” The price target was lifted to $320 from $280.

By contrast, Fortinet was cut to Underweight from Equal-weight, with Morgan Stanley warning that firewall refresh cycles are proving smaller than expected.

The Wall Street firm expects FY26/FY27 estimates to come down, creating a headwind. Even though the stock has dropped 17% year-to-date, analysts said valuations remain stretched relative to slower growth prospects.

They trimmed their price target on the stock to $67 from $78.

“We tend to look at the risk-reward negatively in the near term,” the analysts noted, though they added they could return to a more positive stance once estimates reset.

Alongside the rating changes, Morgan Stanley also assumed coverage of several other cybersecurity names. Palo Alto Networks was named a top pick with an Overweight, supported by its “strategic focus on platformization” and strong positioning across network, cloud, endpoint and identity security.

Okta was initiated at Overweight as the “thousand pound gorilla” in identity access management, with meaningful upsell potential from identity governance and privileged access management.

Varonis also received an Overweight, with the bank highlighting its SaaS transition nearing completion and long-term opportunity in data security posture management as enterprises prepare for the AI era.

The moves reflect Morgan Stanley’s broader framework, which ranks cybersecurity firms on quantitative metrics such as growth and margins as well as qualitative factors like platform positioning and AI integration.

Investing.com -- Cytokinetics (NASDAQ:CYTK) stock surged 31% after the company reported impressive data from its MAPLE-HCM trial comparing its experimental heart drug aficamten to the standard-of-care beta blocker metoprolol for treating obstructive hypertrophic cardiomyopathy (oHCM).

The late-stage trial results showed aficamten improved cardiac structure and function compared to metoprolol, with data published simultaneously in the Journal of the American College of Cardiology. A separate analysis published in Heart Rhythm demonstrated that the annual incidence rate of atrial fibrillation with aficamten is 1.5%, consistent with expected rates in prediction models for patients with hypertrophic cardiomyopathy (HCM).

Wall Street analysts responded positively to the data. Needham analyst Serge Belanger called the results a "clear win" for aficamten over metoprolol on both efficacy and safety, noting that aficamten’s superiority on six of seven key endpoints was "likely better than expected."

Citi analyst David Lebowitz suggested the data could initiate a shift in HCM treatment paradigms, stating, "While it will likely take a while for aficamten to push ahead of beta blockers in new-to-therapy patients, we believe MAPLE could initiate a shift in the HCM treatment paradigm."

Cantor analyst Carter Gould said the MAPLE data "matched, if not exceeded, investors’ high expectations, driven by the consistency of improvement with aficamten and the lack of any improvement with metoprolol." Gould added that the results were not only practice-changing but also differentiating compared to Bristol Myers’ Camzyos.

While the MAPLE-HCM trial is not required for FDA approval of aficamten, which has a decision date of December 26, the data will support a supplemental new drug application. The company hosted an investor webcast to discuss the findings in more detail.

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