Here are Tuesday’s biggest calls on Wall Street: Morgan Stanley reiterates Boeing as overweight Morgan Stanley said it remains bullish on shares of Boeing. “We remain positive on the outlook for aircraft demand and deliveries.” Morgan Stanley reiterates Tesla as overweight Morgan Stanley said its survey checks show Elon Musk’s involvement with Twitter has been negative for Tesla stock. “Our investor survey reinforces our views that Elon Musk’s recent involvement with Twitter has contributed to negative sentiment momentum in Tesla shares and could drive some degree of adverse downside skew to Tesla fundamentals.” Citi reiterates Amazon as buy Citi said Amazon is well positioned this holiday season. “Amazon remains our top pick overall and we note Meta and Alphabet should also benefit from holiday promotions.” Bank of America reiterates Eli Lilly as buy Bank of America said the pharmaceutical company is “best in class.” “Given this backdrop, Lilly remains a top pick, as we see its new product cycle/LT growth as clearly best in class.” Deutsche Bank upgrades UPS to buy from hold Deutsche said macro concerns are overblown for the shipping giant. “It’s easy to be neutral or negative on UPS in the current environment, but in our experience that’s exactly the time to get more positive, especially under the stewardship of the current management team.” Read more about this call here. Berenberg initiates 23andMe as buy Berenberg said the DNA testing company has a “next-generation” type platform. “We are initiating coverage of 23andMe with a Buy rating and $7 price target, implying 115% upside potential. ME is leveraging its breadth of customer genetics data to develop a next-generation, fully integrated, personalized health care and therapeutics platform.” Jefferies downgrades Generac to underperform from hold Jefferies said it sees a “challenging” near-term outlook for the battery backup company. “While GNRC has historically traded at a significant premium to the market given its strong growth profile (19% EPS CAGR 2017-22E), we believe a lower multiple is warranted as growth decelerates.” Morgan Stanley reiterates Microsoft as overweight Morgan Stanley said investors should buy shares of Microsoft at these levels. “While investors worry forward numbers have not been de-risked, we see a strong (and durable) demand signal in the commercial businesses, which should lead to improving revenue and EPS growth in 2H23.” Bernstein reiterates Tesla as underperform Bernstein said it sees a balanced risk/reward on shares of Tesla but that the stock is not a buy yet. “Given TSLA’s pullback YTD, we see current risk/reward on the stock as more balanced, though still modestly negative, given Tesla’s elevated absolute valuation, and the increasing risk of downward revisions amid potential demand challenges.” Read more about this call here. Loop reiterates Apple as buy Loop said in a note to clients that concern about Apple Street estimates being too high is overblown. “The long and the short of it is that while we believe the Street could have estimates set too high for Dec Q-Jun Q, we believe some degree of this is in the stock (waiting for Street numbers to catch up) while also now seeing a commensurate revenue and EPS upside opportunity beginning in the Sep Q ’23.” Guggenheim reiterates Disney as buy Guggenheim said Disney is “well positioned to have industry-leading streaming profit margins at Disney+.” “As Mr. [Bob] Iger has seemed to imply that the company may revisit its core Disney+ guidance of 135-165mm subscribers by year-end FY24, we believe that the company should instead focus on 1) the right pricing structure to maximize revenue from consistent, dedicated subscribers, and 2) leverage the first-party knowledge of the subscriber base to match content investment to necessary engagement.” Bank of America reiterates Virgin Galactic as underperform Bank of America said it sees too many headwinds for the space flight company. “While we see the company taking measures to ensure liquidity both in the near and long term (3Q $100mn raise as part of prior announced distribution agency agreement, outsourcing), we continue to see risks to SPCE’s business model as macroeconomic headwinds continue to mount.” Wells Fargo reiterates AutoZone as overweight Wells said the auto retailer is “resilient.” “While AZO shares have nicely outperformed (+21% vs. +2% SPX since FQ4), we’re staying in the AZO lane into FQ1/FY23. Industry dynamics are proving resilient, AZO is clearly taking share, and post recent management meetings, we see reasons for FY23 upside via DIY volume normalization.” UBS initiates Affirm as neutral UBS said it sees macro and competition concerns for the fintech company. “Exclusive relationships with partners, including Shopify & Amazon, along with its ability to offer financing solutions across a full range of ticket sizes, supports Affirm’s 20-30% medium-term revenue growth target.” KeyBanc downgrades Roku to sector weight from overweight KeyBanc said Roku is facing too many headwinds. “We are downgrading shares of Roku to Sector Weight as elements of our thesis — 1) outsized growth in connected TV (CTV) advertising, and 2) critical platform for media partners — have not manifested.” Read more about this call here . Baird downgrades Darden to neutral from outperform Baird said it sees a more balanced risk/reward for the owner of brands like Olive Garden. “We still have a very positive view of the company’s internal operating fundamentals, and believe DRI is on track to deliver good results in FQ2-FQ3, but when factoring in the year-to-date outperformance for the shares and the lingering risks related to the macro outlook, we simply believe the risk/reward on DRI has become more balanced at current valuation metrics.” Read more about this call here. Loop reiterates Best Buy as buy Loop said its checks show Best Buy as well positioned this holiday season. “We were encouraged by the narrower price gap between Best Buy and Amazon this Cyber Monday as compared to last year, particularly given the fact we believe near multi-decade high inflation will make consumers even more price sensitive this holiday selling season than usual.”
Tuesday, January 31, 2023
Apple, Amazon, Tesla, Disney, Roku
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