Here are Wednesday’s biggest calls on Wall Street: Bernstein reiterates Apple as outperform The firm said Apple has some “downside” risk in a China tariff war but that it’s sticking with its outperform rating on the stock. “We suspect China may be hesitant to impose tax or other penalties on consumer electronics, given such penalties would likely hurt both Chinese workers and consumers, in addition to the desired impact on foreign equity holders. However, there is a risk that China retaliates with incremental targeted taxes on certain companies.” Goldman Sachs reiterates Nvidia as buy Goldman said the stock is best positioned ahead of earnings later this month. “With NVDA still trading well below its past 3-year median P/E multiple relative to our broader coverage universe, we believe the stock is set up well to sustain its outperformance.” JPMorgan upgrades Yum China to overweight from neutral JPMorgan upgraded the China operator of brands like KFC following earnings. “As a result, we see sector-wide discounting level narrowing and market leaders further consolidating the industry. YUMC has achieved positive traffic growth with yoy margin improvement in 3Q24. This is rare in the retailing industry, and YUMC has proven its execution capability – cost saving and efficiency improvement, offsetting the drag from ASP cuts and sales deleverage.” Bernstein initiates Insulet as outperform Bernstein said the insulin pump company is well positioned for upside. “We are initiating coverage of Insulet (PODD) with a TP of $300 (26% upside). Innovation is driving accelerated insulin pump market growth, PODD has a strong moat around the winning form factor, and the type 2 opportunity should drive significant upside to numbers.” Wedbush reiterates Tesla as outperform The firm said the EV maker is a big winner of a Trump presidency. “The biggest positive from a Trump win would be for Tesla and Musk. We believe a Trump presidency would be an overall negative for the EV industry as likely the EV rebates/tax incentives get pulled, however for Tesla we see this as a huge positive.” Jefferies initiates Ryman Hospitality as buy Jefferies said the real estate investment trust has a differentiated offering. “Our positive view on RHP is based on unique hospitality assets within the long-booking-window group market, with post-COVID recovery room and incremental asset growth likely.” Raymond James upgrades Masimo to outperform from market perform The firm said the health technology story looks like a “cleaner business.” “While fully acknowledging the strong recent move in the stock, estimates are expected to trend higher and the MASI story is much cleaner without Consumer, which makes it tougher for us to stay neutral.” Citi reiterates GE Healthcare as buy The firm said the company remains a top pick and is bullish heading into analyst day in late November. ” GEHC will host an Analyst Day on November 21, its first since the IPO: the last event was in December 2022, when as part of General Electric the goal was to educate investors about the company.” Barclays initiates Tencent Music Entertainment as overweight Barclays said the China music company is best positioned. “The combination of a market with little competition, management’s track record of adaption and execution, and new growth path ahead make TME one of the best positioned Chinese Internet companies in their respective fields.” Deutsche Bank reiterates Spotify as buy Deutsche said it’s bullish heading into the streaming company’s earnings report on November 12. “Since the 2Q print, SPOT has outperformed the market, up 15% vs the S & P 500 at +4%. Gross Margins remain in focus as 3Q will have a near full-quarter impact from the US audiobook price increases, which we currently expect to drive ~80bps q/q premium GM expansion in 3Q, after seeing a 120bps q/q uplift in 2Q24.” Deutsche Bank upgrades Celanese to buy from hold Deutsche said shares of the chemical supplier are attractive following an earnings selloff. “We are upgrading Celanese to Buy from Hold following the shares’ 26% decline post its Q3 earnings release.” Wells Fargo reiterates Nike and Burlington top ideas The firm named a slew of retail stocks that it says are the best way to play a tough macro. “Namely, BURL remains our Top Pick (best way to play off-price ‘offense’), GAP (turnaround story working with cheap valuation),TPR (story set to inflect as visibility increases post CPRI outcome), NKE (culture is shifting, numbers reset, risk/reward compelling) and VSCO.” Oppenheimer reiterates Instacart as outperform Oppenheimer said it’s bullish heading into Instacart earnings next week. “Increasing target to $55 (was $48) and reiterating Outperform ahead of 3Q earnings (11/12), despite stock near all-time highs.” JPMorgan downgrades Super Micro to underweight from neutral JPMorgan downgraded the stock following earnings citing too much regulatory uncertainty. “We are downgrading shares of Super Micro to Underweight even following a positive update shared by the company in relation to opinion of the Special Committee, led by the following risk factors that are leading us to expect more uncertainty around both the regulatory filings as well as business fundamentals…” TD Cowen downgrades Brown-Forman to hold from buy TD Cowen said it sees too many negative revisions for the alcohol and beverage company. “We downgrade BFB to Hold and reduce our PT to $48. We believe shares will be rangebound over the medium-term as trends for BFB and the category remain weak.” Needham reiterates Amazon as buy Needham said it thinks the e-commerce giant should be valued as a Services company. “In 3Q24, we believe nearly 60% of AMZN’s revs and 90% of its operating income (OI) came from Services. Therefore, we argue that AMZN should be valued as a Services company, not an eCommerce company.” UBS reiterates Ferrari as buy UBS called the luxury vehicle company “one of the most attractive organic growth stories.” “Q3 was widely expected to be the weakest quarter for Ferrari in 2024, primarily due to temporary headwinds, yet the company’s performance was still ahead of many peers in Luxury as well as Autos sectors.” Barclays initiates Vipshop as overweight Barclays said it’s bullish on the China e-commerce company. ” Vipshop’s focused branded sales model differentiates it in the competitive Chinese ecommerce market.” Mizuho adds Nvidia to its top ideas list in November The firm said it’s sticking with the stock and sees more upside. “We see NVDA remaining the leader in the AI training and inference chips for Data Center applications (we estimate > 95% share), which we believe is growing at a 74% CAGR to > $400B by 2027E.” Monness Crespi Hardt upgrades Snowflake to buy from hold The firm said Snowflake is well positioned for AI. “Unsurprising to us, the gen AI propaganda of 2023 has proven to be a revenue illusion for the software complex in 2024; however, we believe the industry, and Snowflake, will begin to derive incremental activity from this long-term secular trend over the next 12-18 months.” Bank of America downgrades Five Below to underperform from neutral Bank of America said it sees “no clear path to a turnaround with tariffs looming.” “We are downgrading FIVE to Underperform as we do not see a clear path to a turnaround in comps and expect continued margin deleverage on lower sales and incremental tariff costs.”
