Here are Wednesday’s biggest calls on Wall Street:
Morgan Stanley names Apple a top 2023 pick
Morgan Stanley said Apple is a “rare best-of-both worlds outperformer.”
“We see Apple as a rare best-of-both worlds outperformer - a more defensive, quality name during challenging times, but an outperformer in the early cycle.”
Baird names Tesla a top 2023 pick
Baird said it’s standing by its outperform rating on Tesla shares.
“Demand concerns and near-term macroeconomic headwinds loom over the stock after falling nearly 70% in 2022. We are encouraged by the ramp of gigafactories at Berlin and Austin and believe the long-term setup is strong.”
Morgan Stanley names Amazon a top 2023 pick
Morgan Stanley said Amazon is operating from a “leading e-commerce profit generating position.”
“Amazon’s high-margin businesses continue to allow Amazon to drive greater profitability while still continuing to invest”
Morgan Stanley reiterates Microsoft as overweight
Morgan Stanley said it’s staying bullish on the stock heading into earnings next week.
“While indicators that Microsoft is not immune to the weaker IT spending environment aren’t hard to find, the preponderance of evidence in our survey work suggests favorable near-term consolidation trends and further improvement in the longer-term positioning against core secular growth initiatives.”
KeyBanc reiterates Netflix as sector weight
KeyBanc said it’s cautiously optimistic heading into Netflix earnings on Thursday.
“Coupled with the removal of net add guidance and monetization events on the horizon (e.g., ads, password sharing, and likely a 1H23E price increase), we believe there will be little for investors to nitpick on the print.”
Morgan Stanley downgrades IBM to equal weight from overweight
Morgan Stanley downgraded IBM and said “late cycle outperformance [has] runs its course.”
“we downgrade IBM to EW (from OW) as rev growth decelerates and risk of underperformance in a 2H23 early cycle bounce increases.”
Redburn downgrades Exxon to sell from neutral
Redburn downgraded the oil and gas giant on valuation.
“We continue to like Chevron and Exxon’s focus on low-risk repeatable upstream growth and their more conservative approach to low-carbon investments. ... .We downgrade Exxon to Sell on valuation and keep Chevron on Neutral.”
BMO initiates CrowdStrike as outperform
BMO initiated the cybersecurity company and called it “best-in-class.”
“We believe that CrowdStrike offers best-in-class endpoint security capabilities and an expanding platform that will help CrowdStrike compete against Microsoft and other vendors.”
Citi opens a catalyst watch on Qualcomm and Intel
Citi opened a negative catalyst watch on Qualcomm and Intel due to concerns about weakness.
“We expect weakness for both Intel and Qualcomm stocks during earnings given we have received a lot of investor interest in both stocks combined with lower guidance.”
Citi downgrades Morgan Stanley to neutral from buy
Citi downgraded Morgan Stanley after its earnings report mainly on valuation.
“In our view, the market is pricing in best in class returns and we do not see significant relative upside.”
Morgan Stanley upgrades Gap to equal weight from underweight
Morgan Stanley said it sees more “upside than downside” for the stock.
“On GPS, we see more upside than downside at current levels, & move to Equal-weight with an unchanged $12 price target from Underweight prior.”
Mizuho upgrades Oatly to buy from neutral
Mizuho said it sees accelerating growth for the oats beverage company.
“We do not expect FCF-positive operations until 2H24, but liquidity tightness appears manageable and EBITDA can inflect positive exiting FY23. Limited elasticity for plant bevs supports our bullishness and improving capacity should accelerate OTLY growth.”