Here are Monday’s biggest calls on Wall Street:
Wolfe downgrades ChargePoint to peer perform from outperform
Wolfe said it sees too much uncertainty for ChargePoint.
“We’re resetting our revenue and gross margin expectations as we see significant uncertainty in the medium-term; Downgrading to Peer Perform from Outperform.”
Jefferies upgrades Six Flags to buy from hold
Jefferies said it’s bullish on the company’s merger with Cedar Fair.
“We upgrade SIX to Buy from Hold as the merger of FUN and SIX materially increases value for SIX holders.”
Raymond James reiterates Nvidia as strong buy
Raymond James said it’s bullish heading into Nvidia earnings on Tuesday.
“We expect another strong quarter from NVDA and believe that a 5-10% revenue beat (and raise) is likely despite mixed 3Q Cloud capex trends and recent China export controls.”
Stifel initiates Mach Natural Resources as buy
Stifel said it’s bullish on the oil and gas company.
In our view, MNR offers a highly differentiated investment proposition as investors are paid a peer-leading dividend yield while allowing management time to execute its roll-up and return of capital strategy in arguably the best basin in the Lower 48 to pursue that strategy.
Wells Fargo initiates Arm as overweight
Wells said it’s bullish on the semiconductor stock.
“We initiate ARM with an OW rating. Arm has been the leading innovator in RISC-based compute since its founding in 1990 as a JV involving Acorn & Apple, and we believe it can continue the momentum well into the future by taking compute share.”
Bernstein reiterates Tesla as underperform
Bernstein said it’s standing by its underperform rating on Tesla as EV growth is slowing.
“EV growth appears to be slowing, and some investors have asked whether wealthy, tech savvy early adopters have become increasingly saturated, with mass market consumers - ‘average’ Americans - not yet ready to pick up the slack/ purchase an EV.”
JPMorgan reiterates Apple as overweight
JPMorgan said in iPhone lead times are moderating for Apple.
“In Week 10 of our Product Availability Tracker, delivery lead times have moderated for the eighth consecutive week, and are now tracking on average to 2 days across the 15 Series, a decline of ~2 days in the last week, which is roughly in line with the magnitude of decline in the prior week.”
BTIG initiates Global Payments as buy
BTIG said it sees an attractive entry point for the payments company.
“GPN’s global payments infrastructure enables more than 66 billion transactions per year, services ~4 million merchant locations, and we believe the stock presents investors with an attractive entry point trading at 10x FY24E adjusted EPS.”
Morgan Stanley downgrades Chegg to underweight from equal weight
Morgan Stanley said it sees a tough setup for the education company.
“LT, (long term) challenges from GenAI competition create a smaller opportunity for Chegg, likely leading to negative consensus estimate revisions in 2024 & 2025.”
Deutsche Bank upgrades Boeing to buy from hold
Deutsche said the “revision outlook inflects” for the aerospace giant.
“We are upgrading Boeing to Buy (from Hold) and increasing our target price to $270 Our updated target price offers 30% upside. Our upgrade rationale is simple: aircraft deliveries are accelerating, and we think there’s a credible case to be made that this improved performance can be sustained.”
Wells Fargo initiates ZipRecruiter as overweight
Wells said in its initiation of the jobs and employers website that it’s a “well-positioned in a large, fragmented space.”
“A differentiated AI-powered service that continuously improves to deliver better outcomes to both employers and job seekers gives ZIP a competitive advantage in a $300B+ market that is shifting online.”
JPMorgan upgrades Dutch Bros to overweight from neutral
JPMorgan said the coffee chain has “strong available liquidity” to continue to grow.
“Dutch Bros has seen significant changes its capital structure and shareholder base in the past few months.”
Wells Fargo downgrades Spectrum Brands to equal weight from overweight
Wells said in its downgrade of the home essentials company that it’s less convicted about fundamentals.
“SPB is cautious on 1H, signalling retailers intend to manage inventory tightly.”
Evercore ISI adds a tactical outperform on Hewlett Packard
Evercore said the company is well positioned heading into earnings on Tuesday.
“We think HPQ is well-positioned to report upside to current street models for the Oct-qtr driven by PCs. HPQ will report its Oct-qtr EPS on Tuesday, November 21st after market close.”
JPMorgan reiterates Amazon as a top idea
JPMorgan said it’s bullish on Amazon heading into the holiday season.
“Amazon maintains a leading 44.6% share of US e-comm & enters the holiday season with strong momentum from early holiday promotions, increased same- day/1-day delivery (SD1D), regionalized US fulfillment infrastructure, record holiday hiring (AMZN an outlier), wide selection, & competitive prices.”
Goldman Sachs initiate Krystal Biotech as buy
Goldman said it sees a “blockbuster” opportunity for the biotech company.
“We initiate coverage on Krystal Biotech (KRYS) with a Buy rating and 12-month price target of $160.”
Bank of America upgrades Penn to buy from neutral
Bank of America said it’s bullish on Penn’s partnership with ESPN.
“We are upgrading PENN Entertainment from Neutral to Buy. Why now? We think ESPN Bet creates an asymmetric risk-reward, with 1) initial download and app activity much stronger than anticipated, 2) initial offers showing promotional discipline, and 3) stable Q3 earnings (see report) being better than expected for PENN’s core gaming business.”
JPMorgan downgrades Krispy Kreme to neutral from overweight
JPMorgan downgraded the stock mainly on valuation.
“Krispy Kreme stock has continued its broad pattern of stock volatility, being down 3% since 3Q23 earnings (and down 7% day of) but still up ~26% YTD vs up 18% for SPX but down 11% y/y vs up ~14% for the SPX, respectively.”
Citi initiates Equifax as buy
Citi said in its initiation of the credit company that it’s underappreciated.
“We initiate on Equifax with a Buy. In our view, consensus underappreciates the likely impact on Equifax’s adjusted EBITDA arising from a rebound in the US mortgage market, which is running near lows seen in the Great Financial Crisis.”
UBS downgrades Energizer to neutral from buy
UBS said in its downgrade of the stock that it sees an unattractive risk/reward.
“We are downgrading shares of ENR to Neutral from Buy. Even with shares trading off 10% over the recent days, we believe the risk/reward is no longer attractive as current valuation remains above recent history.”
Stifel initiates Kosmos Energy as buy
Stifel said in its initiation of the energy company that it has strong cash flow.
“We are initiating coverage of Kosmos Energy with a Buy rating and $10/sh price target. Kosmos Energy is a leading E&P with an enviable portfolio that is about to deliver record levels of production and cash flows.”
Bank of America upgrades Vale to buy from neutral
Bank of America upgraded the metals and mining company due higher iron ore prices.
“Restocking coupled with seasonally weaker iron ore output from Brazil and Australia should support a tighter 1Q, then we see prices gradually falling to $100/t by 4Q24. This boosts our 2024 iron ore avg to $125/t and backs our upgrades of Vale, CSN and USIM to Buy – the latter two out-of-consensus.
HSBC initiates Caterpillar as hold
HSBC said in its initiation of the Caterpillar that it sees “mounting headwinds.”
“The world’s leader in construction machinery …but we see profits falling in 2024e as infrastructure-related bills will take time to play out and slowdown signs emerge.”
BMO names Sherwin-Williams a top pick
BMO said the paint company has “reasonable upside.”
“We are raising SHW to one of our “Top Picks” as we believe our above-consensus estimates (which we tweaked up modestly just on FX today) have reasonable upside to them as we look to 2024/25, particularly on the GM line.”
Wedbush downgrades KB Home to neutral from outperform
Wedbush downgraded the stock mainly on valuation.
“We are downgrading KBH to NEUTRAL from OUTPERFORM. The shares are within 5% of our unchanged price target, and we do not see an evolving catalyst to increase the PT.”
Melius initiates Dell as buy
Melius Research initiated Dell with a buy and said it’s an “inexpensive” way to play AI.
“Inexpensive AI Play Heading into a Cycle – Initiate with a Buy Rating.”
Northcoast downgrades Wingstop to neutral from buy
Northcoast downgraded the stock mainly on valuation.
“But share price has finally caught up in our opinion. Trading at $133 per share at the beginning of the year, shares are now priced just below our $235 price target. Consistently strong top and bottom-line performance convinced investors that Wingstop’s growth strategy would continue to drive compelling operating results.”
Oppenheimer reiterates Microsoft as outperform
Oppenheimer said Microsoft’s hiring of OpenAI’s Sam Altman is a “major” win.
“While we don’t think this story is over, former OpenAI CEO Sam Altman and key employees are Microsoft employees for now, a major MSFT win.”
