Here are the biggest calls on Wall Street on Friday:
Truist downgrades Tesla to hold from buy
Truist said in its downgrade of the stock that it was surprised by the company’s “willingness to accept lower margins.”
“What surprised us is TSLA’s stated willingness to reduce price further, accepting still lower automotive margins, to broaden & deepen its ability to generate revenue from AI projects, most notably FSD.”
Wells Fargo reiterates Microsoft as overweight
Wells says expectations are “mixed” heading into earnings next week, but that the firm is standing by the stock.
“While optimizations and macro are likely to impact FQ3 results, we see favorable offsets forming beyond, inc. MSFT’s ability to both consolidate spend from incumbent categories (productivity, biz apps, security) & gain share in newer ones.”
Bank of America reiterates Alphabet as buy
Bank of America says it’s bullish heading into Alphabet earnings next week.
“We think 1Q could show cost improvement upside, while in-line search results could be a modest positive for market share concerns (we think street will see better evidence of cost cutting and margin improvement by 2Q).”
JPMorgan reiterates Amazon as a best idea
JPMorgan says it’s bullish heading into the e-commerce giant’s earnings report next week.
“We’re modeling continued e-comm share gains in 2023 as AMZN & other retailers gain share in key under-penetrated categories such as grocery, CPG, apparel & accessories, & furniture/appliances/equipment.”
Benchmark initiates Sea Limited as buy
Benchmark initiated the Singapore-based internet tech company with a buy and says it sees rapid growth ahead.
“We believe that SE should remain a key beneficiary of Southeast Asia’s fast growing digital economy in years to come.”
Benchmark initiates Grab Holdings as buy
Benchmark said in its initiation of the Asian internet company that it’s a “significant market consolidator”
“As part of our industry launch of Southeast Asia Ecommerce, we are initiating coverage of GRAB, a leading platform player offering mobility, delivery, fintech and enterprise services in SEA (Southeast Asia Ecommerce).”
Wells Fargo names Starbucks a top pick into earnings
Wells says Starbucks is a “best idea” heading into earnings on May 2 and the “China inflection adds upside.”
“Shares are -2% post-Q1 & we see improving Q2 risk/reward behind ongoing domestic strength (positive Q2 traffic; Ex 29), a likely China inflection (vs. a very low Q2 bar) & anticipated upside to the FY23 outlook.”
Baird reiterates McDonald’s as outperform
Baird says it’s bullish heading into earnings next week.
“We see potential for Q1 comps/EPS to exceed estimates (perhaps already priced in?), and we continue to believe MCD can fuel solid operating momentum in the balance of 2023 despite possible economic headwinds.”
Cantor Fitzgerald initiates UnitedHealth as buy
Cantor said in its initiation of the healthcare company that it sees near-term earnings upside.
“United is ahead of the market in using commercial product innovation to solve for the problem of employers wanting to hold price trends, while providers are looking for a three-year step-up from historical averages.”
Morgan Stanley reiterates Spotify as overweight
Morgan Stanley raised its price target on the stock to $160 per share from $130 and says “price increases, margin expansion, and market share” will drive the stock.
“We continue to see streaming music & audio as an attractive growth market and remain OW WMG and SPOT.”
HBSC upgrades AT&T to buy from hold
HSBC said in its upgrade of the stock after its earnings report that investors should buy the dip.
“But a slowdown in market momentum has been widely flagged (by all operators) for months, and AT&T’s absolute growth in mobile subs remained solid.”
Stephens initiates SentinelOne as overweight
Stephens initiated the cyber security company with an overweight and says it has “best-in-class growth.”
“SentinelOne’s platform addresses many of the highest priority areas of security spending.”
Goldman Sachs reiterates ServiceNow as buy
Goldman says it’s bullish heading into the work flow solutions company’s earnings report next week.
“We expect investors to put more weight on NOW’s 1Q results, despite it being a seasonally weak quarter, as they look for signs of continued durability.
Morgan Stanley reiterates Blackstone as overweight
Morgan Stanley says the alternative investment management company is “resilient.”
“We believe BX is best positioned to navigate the backdrop, capitalize on dislocation with $190b dry powder & propel earnings power.”
Morgan Stanley downgrades Seagate to equal weight from overweight
Morgan Stanley said in its downgrade of Seagate that it sees a recovery pushout for the hard disc data drive company.
“As a result, we believe path to outperformance has also been pushed out, with risk more elevated near term.”