Here are Thursday’s biggest calls on Wall Street: JPMorgan downgrades Roblox to neutral from overweight JPMorgan downgraded the stock after Roblox’s earnings report, noting it now sees “modest” sales growth. “Our previous view on Roblox was that an improving y/y bookings rate could drive continued outperformance in shares.” Read more about this call here. Jefferies reiterates Target and Walmart as buy Jefferies said its survey checks indicate sales growth has accelerated ahead of earnings for Target and Walmart next week. “Ahead of TGT and WMT’ s Q3 prints next week, we are launching eCommerce indicators to predict TGT digital and WMT U.S. eCommerce sales Y/ Y. Based on our indicators, both companies’ online sales growth accelerated in Q3, TGT: ~20% vs. 9% in Q2; WMT: up more than 13% vs. 12% in Q2.” Morgan Stanley reiterates Apple as overweight Morgan Stanley said on Thursday that it sees a “hardware subscription as a key catalyst to transition the market towards an LTV-based valuation for Apple.” “…and given the stronger than expected hardware subscription adoption intentions, we make our updated $235 LTV (loan to value) valuation our new Apple bull case valuation.” Wolfe downgrades General Motors to peer perform from outperform Wolfe downgraded the stock due to “pricing concerns.” “Our rationale was that GM should have more valuation support from SOTP (Cruise) and growth opportunities (with significant competitive advantages) that they have been building in EVs.” UBS downgrades Altria to sell from neutral UBS said in its downgrade of the tobacco company that it sees other names better positioned elsewhere in the firm’s coverage. “Despite its 2023E 8.3% dividend yield and $1.8bn buyback, we expect MO to underperform the sector.” Morgan Stanley reiterates Rivian as overweight Morgan Stanley said the electric vehicle is a good investment alternative to Tesla. “We believe RIVN may continue to benefit from customers who want to stand out from Tesla ubiquity.” JPMorgan names Canadian Pacific a top pick JPMorgan said shares of the railroad company have more room to run. ” Canadian Pacific already broke its all-time monthly tonnage record for grain shipments in October after delivering +9.8% YoY volume growth in 3Q22 on strong potash and intermodal shipments.” Credit Suisse downgrades Hanesbrands to neutral from outperform Credit Suisse said that the underwear company’s recovery will take longer than expected. “What’s unique about HBI is: 1) HBI owns its manufacturing, and has more near-term deleverage on its manufacturing facilities vs most peers, and 2) the balance sheet…burning $400m of cash from ops ahead of a potentially worsening macro makes the equity challenging to embrace in the near-term.” Loop upgrades Palo Alto Networks to buy from hold Loop said in its upgrade of the stock that it sees “accelerating momentum.” “Our most recent industry checks indicate that PANW’s enterprise business is showing signs of accelerating momentum driven by an increase in large deal activity.” Loop reiterates Alphabet as buy Loop called the internet giant a “secular growth blue chip with fortress moat and minimal premium to S & P.” “We think the core search franchise will remain resilient compared to other forms of advertising and view GOOGL shares as highly attractive at current levels.” Bank of America downgrades Silvergate to neutral from buy Bank of America said that Silvergate is losing it’s first mover advantage. “Binance’s announced acquisition of FTX (which subsequently fell through, according to Binance press release) amid rumored liquidity concerns, according the press, is a black eye on the broader crypto market.” Read more about this call here. Oppenheimer reiterates Coinbase as outperform Oppenheimer said it’s standing by shares of Coinbase but that the crypto sector at large is having “Lehman moment.” “The crypto industry has been going through a calamitous hurricane from the fallout of FTX. It has turned from a Bear Stearns moment when Binance signed a non-binding LOI (letter of intent), to a Lehman Brothers moment when Binance walked away from the deal one day after.” Read more about this call here. Bank of America downgrades Upstart to underperform from neutral Bank of America downgraded the consumer lending company and cited a tough macro environment. “Although UPST’s business model has shown tremendous growth in a benign credit environment, we are concerned about the company’s ability to perform in an environment of rising rates and defaults.” Wedbush removes Tesla from the best ideas list Wedbush removed the stock from its best ideas list and says it’s becoming “increasingly challenged.” “This morning we are removing Tesla from the Wedbush Best Ideas list as our near-term view of this name is increasingly becoming more challenged.” Read more about this call here. JPMorgan downgrades Vacasa to neutral from overweight JPMorgan said in its downgrade of the vacation booking company that trends appear soft. “We are downgrading VCSA shares to Neutral coming out of 3Q as the print raised a few concerns heading into 2023.” Raymond James upgrades Activision Blizzard to outperform from market perform Raymond James said it sees an attractive risk/reward outlook for the stock. “In the nine months since, however, trends in the core business have improved significantly, making a price drop on a deal break less precipitous for a standalone ATVI share price. As we still believe the deal will close as proposed, we see risk/reward as having shifted solidly to the positive.” Bank of America reiterates Meta as neutral Bank of America said it’s encouraged by the new “cost focus” at Meta as the company cuts jobs. “We are encouraged to see Meta rationalizing its cost base, which seemed large even for attractive market conditions.” Evercore IS adds a negative tactical call on Target Evercore added a negative tactical call on shares of Target heading into earnings next week, noting it sees the company posting a miss. “We are Initiating a negative Tactical Trading Call on TGT ahead of its 3Q earnings on 11/16 . We see Target posting a miss and lower 3Q reflecting 1) our view that comps are likely in a relatively modest 2-2.5% range, product mix is likely a headwind, and there is further work to clear inventory after a 6+ month build up.”
