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Here are Monday’s biggest calls on Wall Street: RBC upgrades Pinterest to outperform from sector perform RBC said shares are attractive. “Liked by the sell-side but under-owned by the buy-side, we believe PINS is an attractive story underpinned by checks indicating key product cycles starting to work, positive ad load analysis, attractive comps and is a less consensus/partially hedged way to play AMZN.” Piper Sandler downgrades Domino’s to neutral from overweight Piper downgraded the stock mainly on valuation. “Following a well put together Investor Day event, we are moving our rating on DPZ to Neutral, down from our previous rating of Overweight. This is a valuation and Risk-Reward based decision, and we are not negative on the business or the strategy (or anything of that nature).” Evercore ISI upgrades Hewlett Packard to outperform from in line Evercore said it sees numerous tailwinds for the PC maker. “We are upgrading HPQ to Outperform given that we see a multitude of tailwinds that can power HPQ to > $4.00 of EPS in the next 12-24mos.” Bank of America reiterates Meta as buy Bank of America said Meta is a top pick in 2024. “Among large caps, we prefer Meta for the ongoing Reels monetization cycle, along with: 1) solid overall usage trends around video, 2) under-appreciated AI capabilities (that are driving usage and ad spend), and 3) ramping monetization of messaging assets. Wells Fargo initiates Stellantis as underweight Wells said in its initiation of Stellantis that it sees too many headwinds for the auto company. “This reflects our cautious view on the industry into 2024 and beyond. Key headwinds include price deterioration, the costly BEV ramp, possibly softening pickup demand, & excess global capacity.” Barclays names Nike a best idea Barclays said Nike shares are at an inflection point. “We believe FY2Q24 is the inflection moment for NKE . In this note, we lay out six catalysts to support NKE’s margin recovery and earnings upside in 2024.” Evercore ISI upgrades Kraft Heinz to outperform from market perform Evercore said the stock is a “value pick.” “”We are upgrading KHC from In Line to Outperform and increasing our price target from $40 to $42—16% upside and equal to 13x 2025e EPS.” MoffettNathanson names Amazon a top 2024 pick Moffett said the e-commerce giant is a top pick for the firm in 2024. “For Amazon, last quarter’s expense reductions and commentary on AWS increase the probability for besting consensus FY24 EBIT estimates by ~20%.” TD Cowen names Nvidia a top idea TD said the stock is a top pick in 2024. “An accelerating product roadmap keeps NVIDIA the far and away leader in the very early days of a massive paradigm shift to ubiquitous accelerated computing and generative AI.” TD Cowen names Snowflake a top 2024 idea TD said it’s bullish on the company’s AI product line. “As 1) Cloud consumption conditions stabilize; 2) enterprises start turning to their Cloud data estates to invest in AI on private data; and 3) SNOW releases a substantial amount of new product to market in ’24, we see a compelling growth construct.” Loop downgrades Paramount Global to sell from hold Loop downgraded Paramount on reports of a company takeover. “The Hollywood trades, including Deadline, have reported that David Ellison’s Skydance Media, in partnership with RedBird Capital, is kicking the tires on National Amusements (NAI), the controlling shareholder of Paramount. … .However, we do not see the upside for the public shareholders of PARA, and therefore are lowering our PARA rating to Sell from Hold.” Citi upgrades Nike to buy from hold Citi said Nike shares are attractive. “An Attractive Margin Recovery Story in a Choppy Macro; Upgrading to Buy.” TD Cowen upgrades Avantor to outperform from market perform TD said it’s more bullish on the biotech company after its investor day last week. “We’re upgrading to Outperform following Friday’s Investor Day, where several items make us more bullish: 1) a material cost cut program that creates margin upside, 2) a new operating structure that improves transparency and supports growth.” Jefferies upgrades Best Buy to buy from hold Jefferies said Best Buy shares are inexpensive. “Catalysts + Cheap + > 5% Dividend; Move to Buy.” Jefferies upgrades Cigna to buy from hold Jefferies said Cigna walking away from a deal with Humana is a “win” for Cigna investors. “Walking Away from HUM Deal is a Short-Term Win for CI Investors; U/G to Buy.” Morgan Stanley upgrades Occidental Petroleum to overweight from equal weight Morgan Stanley said Occidental has a high-quality portfolio. “The company has a high quality asset portfolio with attractive inventory depth and we see a path for the stock to return to its full historical premium through further balance sheet improvement, preferred redemption, and ultimately a more meaningful base dividend.” Wells Fargo upgrades Snap to overweight from equal weight Wells said Snap shares are an inflection point. “See advertising positively inflecting at Snap for first time since Apple’s privacy initiatives in April ’21. Reinvestment in ad tech stack, new ads mgmt and renewed focus leads us to raise ests. materially above the Street and move to OW from EW.” Susquehanna downgrades Super Micro Computer to negative from neutral Susquehanna said in its downgrade of the tech server company that it sees gross margin pressure for Super Micro. “Reducing EPS estimates to reflect increased GM [gross margin] pressure caused by increased competition and higher Memory/Storage cost.” Goldman Sachs upgrades AbbVie to buy from neutral Goldman said the stock is well positioned heading into 2024. “We are upgrading our rating on ABBV shares to Buy from Neutral. Our 12-month price target of $173, which implies a 17% return from current levels, derives from our updated methodology which incorporates a 50/50 blend of a DCF-based approach and a P/E multiple of 13x our 2025 estimate of $12.45. Citi opens a positive catalyst watch on 3M Citi opened a positive catalyst watch on the stock and said it’s at an inflection point. The firm maintained its long term neutral rating. “Given MMM’s shorter-cycle exposure, the company is usually ‘first-in & first-out’ through business cycles and we expect MMM’s consumer/electronics business to begin to inflect over the course of ’24 as destocking runs its course and demand stabilize/recover.” Rosenblatt upgrades Spotify to buy from neutral Rosenblatt said it likes the company’s restructuring plan. “Spotify’ s large-scale restructuring last week — shedding 17% of headcount, and its CFO, could be seen as scary, or promising.” Stephens upgrades Lennox to overweight from equal weight Stephens said in its upgrade of the manufacturing company that it sees numerous tailwinds for Lennox shares. “With an impressive/growing track record for the fairly recently-assembled C-suite (commercial recovery, portfolio honing, captive-distribution focus), we see three emerging/ underappreciated/significant earnings growth drivers.” Barclays reiterates Apple as equal weight Barclays said in a note late Friday that its checks show Apple’s App Store is showing year over year growth. “Nov. App Store grew 11% Y/Y on easier compares and Dec-Q App Store is tracking toward 9-10% growth, in line with 9.3% growth for Sep-Q.” BMO upgrades J.B. Hunt to outperform from market perform BMO said in its upgrade of the shipping company that it sees a “meaningful market share opportunity.” “We are upgrading JBHT to Outperform and increasing our target price to $220 from $200 previously.
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