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Monday’s top Wall Street analyst calls: JPMorgan & First Republic

A video sign displays the logo for Roku, after the company’s IPO at the Nasdaq Market in New York, September 28, 2017.

Brendan McDermid | Reuters

Here are the biggest calls on Wall Street on Monday:

Bernstein downgrades Lam Research to market perform from outperform

Bernstein said the semiconductor company is overvalued.

LRCX is more expensive, and it has been near our target price for some time; given we believe there remains considerable uncertainty around memory it feels prudent to move to the sidelines for now though we continue to like the longer term story.”

Cowen upgrades Moderna to outperform from market perform

Cowen said it sees an attractive risk/reward for the biotech company.

“COVID is approaching its tail, as evidenced by expectations for >$5B. MRNA will be a leader in RSV, and we expect flu A VE data by month’s end to be superior.”

JPMorgan downgrade British American Tobacco to neutral from overweight

JPMorgan said in its downgrade of the tobacco company that it sees slowing growth.

“We downgrade British American Tobacco (BAT) to Neutral. Competitive & regulatory risks are building in Vapor, while BAT’s US cigarette trends remain weaker than expected.”

Morgan Stanley reiterates Apple as a top idea

Morgan Stanley said it sees several positive catalysts ahead for Apple.

“However, as we look beyond the near-term, we see a catalyst-rich event path over the next 12 months that is underappreciated by investors, including reaccelerating iPhone and Services growth record gross margins (we see the greatest inflection in F1H24), two new product launches (AR/VR headset and iPhone 15), and the potential introduction of an iPhone subscription program.”

Credit Suisse downgrades Logitech to neutral from outperform

Credit Suisse downgraded the computer products company due to a lack of near-term catalysts for Logitech.

“Continued high macroeconomic uncertainties have led the company to provide guidance only for H1 and not for full FY24, which it plans to return to in the future.”

Read more about this call here.

Wolfe downgrades Tesla to peer perform from outperform

Wolfe downgraded Tesla due to macro concerns.

“We’re still convinced of Tesla’s impressive cost trajectory, which should propel impressive growth over time. However, we’ve also become incrementally more concerned about macro challenges.”

Goldman Sachs reiterates Sunrun as buy

Goldman said the solar company is most exposed to Silicon Valley Bank, but it’s sticking with its buy rating.

“SVB is also a facilitator of RUN’s interest rate hedges and represents <15% of the overall hedging facilities, however, the bank is not the backer of those derivatives, according to RUN.”

Baird upgrades Truist to outperform from neutral

Baird said it sees an attractive risk/reward for the regional bank.

“Regional bank risk/reward trade-off improving, and we would get more aggressive on the regional bank side, upgrading TFC to Outperform.”

Raymond James downgrades First Republic Bank to market perform from strong buy

Raymond James double downgraded the regional bank due to concerns about the events at Silicon Valley Bank.

“We are downgrading shares of FRC to Market Perform from Strong Buy. While the bank is better positioned for potential deposit outflows on Sunday evening than it may have been earlier in the weekend, if there are net deposit outflows, it will shrink the EPS power of the bank. Therefore, we have a negative bias to our EPS estimates.”

Citi downgrades Petco to neutral from buy

Citi downgraded the stock due to “model challenges” ahead of earnings later this month.

“We proactively lower 2023 estimates below Street ahead of 4Q earnings on 3/22 due to continuing weakness in discretionary, the potential for “trade down” in pet (=share loss for Petco), and EPS dilution from higher rates.”

Wells Fargo upgrades JPMorgan to overweight from equal weight

Wells said in its upgrade of the banking giant that “goliath is winning.”

JPM epitomizes our theme of ‘Goliath is Winning’, which should benefit both offense (market share gains) and defense (more diversified) in these less certain times. We increase ests., PT, and rating to Overweight from Equal Weight.”

Read more about this call here.

Citi upgrades PNC to buy from neutral

Citi said it sees a compelling entry point for the regional bank.

“While the news should be positive for the stocks, it is unclear to us how they will perform tomorrow. We do think it makes sense to add to exposure here, so of our Holds the most attractive name here for us is PNC.”

Read more about this call here.

Wells Fargo upgrades Eli Lilly to overweight from equal weight

Wells said investors should buy the dip in shares of Eli Lilly.

“We are upgrading LLY to Overweight as recent weakness creates a buying opportunity. We think fundamentals of the company remain the same, and at current levels risk / reward into donanemab Alzheimer’s trial may be skewed to the upside.”

Wells Fargo upgrades Amgen to overweight from equal weight

Wells said in its upgrade of the biopharma company that “weakness creates opportunity.”

“We rate AMGN Overweight, as we think the company’s near-to-medium-term growth profile, including HZNP major product drivers delivering modest sales, can achieve a 6% top line and 10% bottom line CAGR from 2023 to 2026.”

Evercore ISI initiates GE Healthcare as buy

Evercore said it’s bullish on the medtech company that was spun off from General Electric.

GEHC is a recent spin, with 18 Bn of revs and a market cap of ~34 Bn is a sizeable new entity in Medtech.”

Bernstein reiterates Airbnb as outperform

Bernstein said the short-term rental company is “uniquely positioned.”

“There is scope for Airbnb further to monetize traffic to its site, by instigating partnerships with food delivery, car rental, ride-share, and airline platforms Airbnb could both add incremental revenue from charging referral fees and enhance the user experience.”

Oppenheimer reiterates Coinbase as outperform

Oppenheimer said it’s standing by its outperform rating on shares of the crypto company.

“Many people will blame the SI/SBNY fallout to be a crypto problem, and use this as an example. The collapse of SIVB shows that cash influx in 2020/2021, rapid rate hike in 2022, asset liability mismanagement, and run on the bank are the likely actual causes. We reduce our PT of COIN from $84 to $70 to reflect revenue and ecosystem risks.”

DA Davidson upgrades PacWest Bancorp to buy from hold

DA Davidson said it sees an attractive entry point for the regional bank.

“Given PACW’s financial update largely in-line with our 1Q expectations, continued execution of the balance sheet contraction strategy, valuation of 73% of TBV, and a positive bias reflected in our recent update, we think last week’s sell-off represents a more attractive entry point for investors, particularly on the heels of Sunday’s announced Bank Term Funding Program (BTFP) by the Fed.”

Bank of America reiterates Charles Schwab as underperform

Bank of America lowered its price target on Charles Schwab to $60 per share from $74 and said it’s concerned about rising rates.

“The significant rise in short-term interest rates over the last 12 months is creating major issues in financial services as the cost (rising) and duration (shrinking) of liabilities are now changing rapidly, which is putting capital intensive financial institutions with long-term assets in difficult situations.”

Mizuho reiterates Meta as buy

Mizuho said its bullish on Meta management’s recent moves.

“We applaud the company’s efforts to drive further efficiency during economic uncertainty, and FY23E consensus implies Reality Labs to incur expenses at 12% of revenues in FY23 (or $14bn), so the capacity for cost optimization is meaningful.”

Bank of America reiterates Alphabet as buy

Bank of America said it’s bullish on Alphabet’s entry into AI.

“However, we continue to see strong data and technology advantages for Google, and see potential for stable search metrics and LLM-based (large language models) product releases over the next few months to help alleviate an overhang in the stock.”

Bank of America reiterates Roku as buy

Bank of America said it’s standing by the stock in the wake of the Silicon Valley Bank collapse.

“On Friday Roku disclosed that it has $487mn of uninsured deposits at Silicon Valley Bank (SVB) which was closed by the California Department of Financial Protection and Innovation.”

Guggenheim reiterates Tesla as sell

Guggenheim said it’s standing by its sell rating on Tesla shares.

“Overall, we believe that with each round of negative incentives/pricing, buyers are becoming increasingly conditioned to expect additional negative pricing actions, in our view.”

Citi upgrades Charles Schwab to buy from neutral

Citi said the stock is compelling at current levels.

“We are upgrading SCHW to Buy from Neutral. After a 23% decline over the last two trading days, we see a compelling risk/reward at current levels.”

Read more about this call here.

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