Here are the biggest calls on Wall Street on Monday:
TD Cowen initiates Spotify as market perform
TD said in its initiation of Spotify that the valuation seems reasonable “already discounts in a fairly optimistic financial trajectory.”
“While we expect Spotify to continue to grow revenue at double-digits and enjoy margin improvement over time, we think current valuation already discounts in a fairly optimistic financial trajectory.”
Bernstein upgrading Spirit AeroSystems to outperform from market perform
Bernstein said it’s bullish on the company’s turnaround opportunity.
“On October 2nd, Pat Shanahan was named interim CEO, from whom we expect an operational plan to reshape Spirit’s performance.”
Evercore ISI adds a tactical outperform on Roku
Evercore said it sees an attractive entry point for the stock.
“We are adding ROKU to our Tactical Outperform list – it’s a near-term (up to 6 months) trading call. At $60 per share, we see a reasonably attractive entry point in this ‘macro’ stock.”
Citi adds a negative catalyst watch on Okta
Citi said the stock seems “listless” right now.
“Following the most recent security incident at OKTA, we are concerned with the risk of new pipeline and biz development activity against these hard-to-ignore headlines.”
Citi downgrades Diamondback Energy to neutral from buy
Citi downgraded Diamondback mainly on valuation.
“For a while the market appeared to take a conservative stance, but now valuation suggests greater comfort with inventory, removing this positive catalyst.
HSBC initiates Marriott as buy
HSBC said Marriott is “best-in-class”
“The world’s largest lodging company, well positioned for growth given its unrivalled scale and best-in-class brand portfolio.”
Bank of America downgrades Alcoa to neutral from buy
Bank of America said the turnaround is taking longer than expected.
“While the BofA commodities team is bullish aluminum (Alcoa’s (AA’s) primary product) for 2024E, they are cautious in the more immediate term. Further, AA is in a period of transition (cost reductions) that we think will take longer than previously expected.”
Evercore ISI upgrades Edison to outperform from market perform
Evercore ISI said it prefers Edison in the utilities sector as the company hasn’t had any major catastrophes in its footprint.
“To sum it up, we think investors do not like all the uncertainties at these utilities and will prefer companies for which they feel they can better predict linear earnings, cash flow and dividend growth. That said, within this comp group, we currently recommend EIX over PCG and ETR.”
Piper Sandler downgrades Salesforce to neutral from overweight
Piper said in its downgrade of the stock that it sees too much uncertainty.
“We lower CRM to Neutral from OW on increasing execution and M&A risks, AI monetization uncertainty, and risk-reward given shares have risen 54% YTD.”
Wells Fargo downgrades Regions Financial to equal weight from overweight
Wells said in its downgrade of the regional bank that it sees too many headwinds.
“RF’s rate headwinds should last longer than previously expected and vs. peer based on 3Q23′s miss, RF’s negative guide, almost worst-in-class 3Q23 deposit beta, and likely later NII [net interest income] inflection.”
Stifel upgrades Pinterest to buy from hold
Stifel said in its upgrade of the stock that there’s “room for growth.”
“We are upgrading PINS to a Buy rating (new TP $32), as checks skew more positive and we think there is still plenty of room for growth outside the domestic market.”
William Blair initiates Celsius Holdings as outperform
William Blair said the beverage company has high-growth potential.
“Our rating is largely driven by Celsius’s attractive position as a high-growth functional beverage business with a brand that is on-trend and differentiated, keenly relevant to a large addressable market, and possesses significant white space for expansion.
UBS upgrades Waste Management and Republic Services to buy from neutral
UBS said in its upgrade of the waste companies that they are defensive.
“We upgrade WM and RSG from Neutral to Buy, and maintain Buy ratings on WCN & CWST, expecting municipal solid waste stocks to be a popular way to ride out current market turbulence and risk of a rate-driven economic slowdown.”
Bank of America reiterates Amazon as buy
Bank of America said it’s standing by its buy rating heading into earnings later this week.
“There is also room for multiple expansion, in our view, with Amazon at 12x EV/FWD EBITDA, towards the lower end of the historical range of 8.5x-30x and median of 17.3x.”
Evercore ISI reiterates Meta as outperform
Evercore said Meta estimates seems reasonable heading into earnings later this week.
“We view the Street’s Q3 Revenue estimate and Op Income estimate as reasonable, with modest upside possibility.”
JPMorgan upgrades Walgreens to overweight from neutral
JPMorgan said Walgreens shares are in a “new era.”
“We believe that today commences a new era for shares of WBA as Tim Wentworth assumes the CEO role, we are upgrading WBA to Overweight and providing a detailed analysis of the components of the companys FY24 guidance.”
MoffettNathanson initiates Instacart as as neutral
Moffett said it sees too many headwinds for Instacart.
“We are once again reminded that capitalism rarely rewards for difficulty level, and grocery is an especially challenging market. We see clouds on the horizon for market share, consumer engagement, advertising growth, and large insider share unlock.
Stephens upgrades Utz to overweight from equal weight
Stephens said it sees an attractive entry point for Utz shares.
“We believe the recent pull back in shares creates an attractive entry point for investors and therefore we are upgrading UTZ from Equal-Weight to Overweight. Our price target moves to $16 (from $18 prior).”
Morgan Stanley reiterates Apple as overweight
Morgan Stanley said iPhone times wait times remain strong and the firm is standing by its overweight rating on Apple shares.
“iPhone 15 Pro Max lead times robust, but we’ve seen some moderation for the iPhone 15 base models, which has been reflected in recent build cuts.”
