Here are Thursday’s biggest calls on Wall Street: JPMorgan downgrades Comerica to neutral from overweight JPMorgan it’s concerned about “downwards pressure on earning asset yields” when it comes to Comerica. “Finally, although Comerica has 56% of deposits in non-interest bearing (above our coverage median at 34%), as customers put excess cash to work into higher yielding alternatives, we view that Comerica could be at an elevated risk of seeing the concentration of non-interest bearing deposits trend lower in the coming quarters.” Read more about this call here. Raymond James upgrades FedEx to outperform from market perform Raymond James said and “undeniable” positive change is underway at the shipping giant. “We are upgrading the shares of FedEx to Outperform from Market Perform as we believe that undeniable change is afoot post the company’s recent DRIVE event in NYC that provided better visibility into key transformational changes that are likely set to drive better margins, earnings, and FCF in out years.” Read more about this call here. Argus downgrades Fox to hold from buy Argus said it’s concerned about Fox’s litigation with Dominion Voting Systems. “Downgrading to HOLD. We believe that a recent adverse ruling for Fox in the Dominion Voting Systems case raises downside risk for FOXA shares.” BMO initiates XPO as outperform BMO said it sees a “significant re-rating opportunity” for the logistics company. “We are initiating coverage of XPO, one of the largest less-than-truckload (LTL) carriers, in North America, with an Outperform rating and a $44 target price.” Stifel initiates Skyworks as buy Stifel said in its initiation of the radio frequency solutions company that it has “strong profitability metrics.” “We are initiating coverage of Skyworks Solutions, with a Buy rating and $150 target price. The radio frequency space has consolidated to a few key players mostly due to the increasing complexity and system level expertise and resources required to design RF solutions for modern (5G) smartphones.” KBW upgrades Fifth Third to outperform from market perform KBW said the bank offers a “better return profile, diversified balance sheet and strong liquidity.” “We are upgrading FITB from Market Perform to Outperform due to 5% discounted valuation on 2024E despite expectations of 130bps better-than-peer ROTCE.” Oppenheimer reiterates Amazon as outperform Oppenheimer lowered its price target on to $125 per share from $135, but said it’s standing by its outperform rating. “We believe AMZN’s 25% underperformance vs. Nasdaq LTM (last twelve months) is being driven by share loss to MSFT and lack of eCommerce profitability.” Raymond James upgrades Wells Fargo to strong buy from outperform Raymond James said the banking giant is well positioned in the current environment. “we are upgrading Wells Fargo (WFC) to Strong Buy from Outperform as we believe it will be a major beneficiary in this changing environment.” Goldman Sachs upgrades Ferrari to neutral from sell Goldman said it’s getting increasingly bullish on luxury. ” Ferrari’s order books have remained steadfast in recent years and are industry leading, with all but two models of the existing production line-up completely accounted for.” Jefferies reiterates Netflix as buy Jefferies said it’s bullish heading into earnings on April 18. ” NFLX is enforcing paid sharing in 4 countries and we’re eager to hear about consumer behavior. 1Q results don’t appear contentious (we’re slightly ahead on paid net adds), but we would buy the dip on a conservative 2Q guide.” Loop upgrades Leslie’s and Pool Corp to buy from hold Loop said both stocks are attractively valued. “We’re upgrading POOL and LESL to BUYs from Hold as our latest pool survey indicated an FY23 outlook that was better than expected, and with POOL shares down 25% since recent highs in early February and LESL down 33%, we think the pullback offers a good buying opportunity especially as we expect both companies to reiterate guidance against valuations that implies meaningful downside to estimates from here.” Needham reiterates Disney as hold Needham said consensus estimates are too high for Disney. “Our HOLD rating on DIS is based on rising DTC losses and our belief that consensus estimates for DIS are too high owing to high investment levels in DTC and another year of weak earnings from linear TV and box office.” Baird names Sunnova a fresh pick Baird said opportunities are expanding for the solar company. “The narratives of weakening demand and difficulty accessing capital have been overdone in our view, and we believe NOVA is set up for a strong quarter despite recent macro concerns.” Goldman Sachs reiterates Costco as buy Bank of America reiterates Walmart as buy Bank of America said it’s standing by its buy rating on the big box retailer after its investor day event on Wednesday. ” WMT also sees sustained +MSD% (mid single digits) sales growth at Sam’s Club from new clubs (30 in next few years) and membership growth, with International posed to grow even faster at +HSD% with all major markets contributing.” UBS reiterates Apple as buy UBS said its survey checks show Apple Services is a key driver of growth for the tech giant. “Key takeaways include: 1) iPhone retention rate in the US is 83%, up 200 bps from last year and 76% pre-Covid. In China, iPhone retention rate is 44%, up from 29% two years ago highlighting the stickiness of the ecosystem. 2) Our analysis suggests supply chain disruptions increased the average age of the iPhone installed base ex China to 31 months, up from 28 mos pre-Covid suggesting some pent-up demand heading into 2H:23.” DA Davidson initiates New Relic DA Davidson said the cloud company is quickly closing the gap with peers. “We believe the current spend-conscious environment sets New Relic up with an opportunity to narrow the growth and valuation gap vis-a-vis its comparables, specifically DDOG.” Deutsche Bank initiates Marqeta as buy Deutsche said shares of the payment solutions company are attractively valued. “Future product expansion into credit card services continues to increase MQ’s TAM. At only ~3x EV to our GP multiple (includes $1.3B of cash) and with normalized growth rates expected to be in excess of 20% over the next five years, we find the shares attractively valued. We are initiating coverage on Marqeta with a Buy rating and $7 TP. Morgan Stanley reiterates Microsoft as overweight Morgan Stanley said Microsoft is extremely well positioned. “Our CIO survey suggests favorable near-term consolidation trends for Microsoft & strong positioning for secular spending priorities, with a widening lead in expected IT wallet share gains.” Raymond James initiates Pinterest as outperform Raymond James said it sees “steady user growth” for Pinterest. “Our positive fundamental view is based on: 1) Pinterest’s unique visual discovery platform and high intent user base provides an attractive platform for advertisers; 2) We expect steady user growth going forward and increasing engagement metrics driven by international and increasing personalization.” Read more about this call here. Bank of America reiterates Spotify as buy Bank of America said it’s sticking with its buy rating on the streaming company. “We remain bullish on the long-term potential of SPOT, which should benefit from an improvement in advertising and deeper penetration in existing markets.” UBS reiterates Alphabet, Pinterest, and Meta as buy UBS said it’s standing by its buy ratings on several social media giants ahead of earnings later this quarter. “Tactically we see the most potential upside surprise at GOOG (revs and EBIT), PINS (monetization partners) and META (estimates still look too low, in our view).”
