Here are Monday’s biggest calls on Wall Street:
Cowen names Yum! Brands a top pick in 2023
Cowen said the owner of brands such as Taco Bell and KFC is attractive heading into 2023.
“In our view,YUM’s diversified, asset-light business model positions the stock favorably as inflation remains elevated.”
BTIG upgrades Domino’s to buy from hold
BTIG said in its upgrade of Domino’s that it sees inflation moderating.
“Upgrading to Buy with $460 Price Target; Additional Pricing, Moderating Inflation, and Organic Labor Improvements Make Us More Bullish.”
Cowen names SolarEdge a top pick in 2023
Cowen said the solar company is well positioned heading into 2023.
“SEDG is well positioned to benefit from secular solar demand driven by policy and higher electricity rates.”
JPMorgan upgrades Murphy oil to overweight from neutral
JPMorgan said the stock is a “relative winner.”
“In a macro setting with upside risk to oil prices, but heightened execution concerns for U.S. shale-levered companies, we think E&Ps with a higher mix of conventional assets (international, deepwater, oil sands) could be relative winners.”
Citi initiates Alaska Airlines as buy and JetBlue as neutral
Citi initiated coverage of Alaska and said it likes the company’s strong pricing. The firm also initiated JetBlue and said it’s concerned about the company’s merger with Spirit.
“The carrier’s strong pricing, traffic flow from its partner airlines, and re-fleeting look attractive. These attributes could help Alaska Air offset the aforementioned headwinds. ... Separately, JetBlue faces unknown operational and regulatory-type repercussions from potential antitrust remedies, associated with the carrier’s efforts to acquire Spirit Airlines.”
Morgan Stanley upgrades United Airlines to overweight from equal weight and names Delta a top pick in 2023
Morgan Stanley said it sees a “bullish” air travel outlook in 2023.
“We remain bullish on the Air travel outlook for the third year in a row but our order of preference again changes slightly. Legacies move to the top of our preference list -DALis our new Top Pick, we upgradeUALto OW (up to #3 in our order of preference), and we remain EW AAL (#7).”
JPMorgan reiterates Apple as overweight
JPMorgan said Apple’s iPhone supply chain challenges appear to be moderating.
“In Week 13 of our Apple Product Availability Tracker, supply appears to continue to improve, with lead times for the iPhone Pro models moderating across all regions, indicating again that Apple is cycling past the worst and making progress in relation to supply challenges.”
JPMorgan reiterates Netflix as overweight
JPMorgan said it sees a “heavily backend-weighted quarter” for Netflix.
“We believeNFLXis a key beneficiary and driver of the ongoing disruption of linear TV, with the company’s content performing well globally and driving a virtuous circle of strong subscriber growth, more revenue, and growing profit.”
Truist upgrades MGM to buy from hold
Truist said it sees the casino stock outperforming in 2023.
“While we’ve historically been more cautious on bear-case macro risks to the Strip and destination markets, we would expectMGMto see relative outperformance in 2023 on the Strip’s strong event calendar and returning midweek business travel.”
Morgan Stanley initiates Marriott as overweight
Morgan Stanley said it likes how the hotel chain has transformed its business and that it sees a “further re-rating.”
“Marriott (MAR, 15% Upside): From beta bellwether to acyclical alpha.”
Oppenheimer reiterates Tesla as outperform
Oppenheimer said Tesla’s long waited semi truck is a “watershed moment.”
“We view TSLA’s demonstration of its 500-mile range with full payload as a watershed moment for EVs in the Class 8 space.”
Bank of America reiterates Deckers as buy
Bank of America said channel checks look bullish on Deckers’ Hoka brand shoes.
“We came away impressed with management’s laser focus on scaling the brand in a controlled manner (not opening distribution too wide). Retailer commentary was bullish on trends at HOKA, particularly recent momentum with the non-running community (work professionals, teens, elderly).”
Deutsche Bank downgrades Starbucks to hold from buy
Deutsche downgraded the coffee giant mainly on valuation.
“On the back of our Limited Service Restaurant work published last week and following a ‘second pass’ at the model postSBUX’sexcellent results in early November, we are moving our rating on SBUX to Hold, down from our previous rating of Buy. Overall, this is a Risk Reward and Valuation call, and there is not much more to it than that.”
Jefferies reiterates Amazon and Etsy as buy
Jefferies said Amazon and Etsy will be winners this holiday shopping season.
“Our proprietary U.S. survey shows 42% of consumers plan to spend more online this year, which is four times greater than the 11% who plan to spend less. We believe our e-commerce coverage (AMZN, ETSY, EBAY) should benefit from durable ecommerce trends in the U.S., but expect int’l to be a drag on Q4 results.”
MoffettNathanson reiterates Disney as outperform
Moffett said it’s standing by its outperform rating on the stock with greater confidence in the company now that Robert Iger has returned as CEO.
“In short, Disney has badly underperformed our long-term forecast as DTC, despite in-line revenues results, generated -$2.4 billion in higher FY 2022 losses vs. what we expected back in Iger’s last days.”
Wells Fargo names Royal Caribbean as a top 2023 pick
Wells named the cruise company as a top idea for 2023 and says it likes Royal Caribbean’s balance sheet.
“RCL is our top cruise pick for 2023, reflecting its relatively better balance sheet/more straight forward deleveraging path, track record of execution and growing EBITDA/ALBD, and reasonable pricing/cost expectations.”
Morgan Stanley downgrades Silvergate to underweight from equal weight
Morgan Stanley said in its downgrade of the crypto bank that it sees too many headwinds due to the FTX collapse.
“Silvergate Capital(SI): The ongoing stress in the crypto ecosystem post the FTX collapse drives significant uncertainty on deposit flows at SI in the near term.”
UBS reiterates Costco as buy
UBS said Costco is a holiday winner.
“Altogether, we think COST has every right to win this holiday season & beyond.”
Atlantic Equities reiterates Coinbase as neutral
Atlantic Equities said it’s sticking with his neutral rating on the stock, but that it thinks the crypto company is well-positioned to survive any crypto controversies.
“We believe Coinbase is well-positioned to both survive and benefit from these events, but the overwhelming headwinds from a prolonged crypto winter cause us to lower our forward estimates significantly.”
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