Here are Tuesday’s biggest calls on Wall Street: Morgan Stanley downgrades Adobe from overweight to equal weight Morgan Stanley says it sees slowing earnings per share growth for Adobe. “Beyond seasonal – expect further structurally slower EPS growth; downgrade to similar weight.” After UBS downgraded Boston Beer, Keurig Dr Pepper and Molson Coors to neutral, UBS downgraded several beverage companies potentially slowing further growth. “We are moving sideways on TAP, SAM and KDP as we expect growth to moderate looking ahead.” Credit Suisse upgrades Exxon Mobil from neutral to outperform Credit Suisse said it likes the company’s “differentiated growth strategy”. XOM always believed that the world would need fossil fuels over the long term and that oil and gas demand would not decrease in the medium term. As a result, XOM has continued to invest in some of the most lucrative oil and gas projects globally. After the Russia-Ukraine conflict, where we have fewer crude, refined products and natural gas, we expect XOM’s differentiated growth strategy to deliver excellent returns for its investors.” Read more about this call here. Wells Fargo upgrades Church and Dwight from similar weights to overweight Wells said it sees a rare buying opportunity for the home products company. “With the stock well-upgraded, bearish prospects (or at least incremental slowing) appear to be a bullish base case meaning the defensive qualities of the CHD shine even brighter; and, perhaps most notably, the CHD.” There is also a ‘subtle’ element here, that is, a data disconnect that is spoiling the narrative.” Read more about this call here. Goldman Sachs downgrades SunPower to sell neutral and Sunnova to buy neutral Goldman downgrades several solar stocks, noting that it is concerned about rising interest rates. “To that end, we downgrade SPWR shares to sell (from neutral), the company’s mix headwinds most pronounced for these dynamics, while we downgrade NOVA to neutral (from buy) ” Bank of America introduced Palantir as a buyout Bank of America said the data analytics software company is a beneficiary in the future of artificial intelligence. “Palantir’s dominant position in the AI-powered software market, differentiated end-to-end and highly secure solutions and first-mover advantages should support over 30% annual revenue expansion and improved profitability over the medium-term.” Read more about this call here. JPMorgan reinstates Caesars as overweight JPMorgan reinstates casino and hotel company coverage. It said it sees several positive catalysts, including a “best-in-class” management team for Kaiser. “We see above $20 for our $59 price target and below $10 to $27 in a hypothetical bearish scenario, whereby the 2023 EBITDAR is 20% below our (below consensus) estimates and these above/ Describes minor target multiples in the scenarios below.” B. Riley downgrades Six Flags from buy to neutral b. Riley said in its downgrade of the amusement park company that it is concerned about a “deteriorating consumer outlook.” “We think there are three issues that could continue to weigh on six stocks over the next 12 months: (1) investors continue to focus on overall attendance decline versus 2019 levels given the new premium pricing strategy ; (2) Decreased in-park spending due to consumer spending is not offset by increased labor and inflationary pressures.” Credit Suisse upgrades Sentinel from neutral to outperform Credit Suisse said the headwind costs it to the already managed care company. “With CNC at 12.2x our 2023 EPS est, we believe headwinds are reflected in the current outlook, and, as becomes clear to the market, we believe CNC will be revalued to a 14x P/E multiple, leading to our $88 six- to 12-month price target.” UBS upgrades Charles Schwab to buy from neutral UBS said in its upgrade of Schwab that the stock “is well positioned to outperform.” “Upgrade to Buy: A risk-free, quality name that is well insulated from credit and market risk.” Read more about this call here. Wells Fargo introduced Virgin Galactic because it weighed less because Wells said it left too much risk with the space flight company. “We see further risk going for SPCE, as we suspect it can develop its new Delta spacecraft and continue operations without further capital growth, while we anticipate that the stock Currently ticket sales are at least 10x in acceleration in what we see as impossible.” Stifel reiterates its hold rating on Netflix shares on Monday, but it’s getting more constructive on the stock. “At the current share price, we believe the market may be overlooking a multi-year opportunity for a return to sustainable customer growth, with optionality stemming from the company’s upcoming ad-supported and password-sharing plans.” Bank of America upgrades FMC to buy from underperforming Bank of America, in its upgrade of the fertilizer company, said it sees an attractive valuation. “We double-upgrade FMC because (1) the stock has been the worst performer in our AG coverage. Making Val’n more attractive on a 3-month basis (22% of our unchanged PO), (( 2) We slightly raise our projections for 2022-23 based on favorable results from this Ag Retailer survey.” JPMorgan downgrades Hylian to weigh less than neutral. Citi downgraded the paper company due to supply chain issues. “Growing Questions Loom on Demand as Supply; Downgrading IP and WRK to Neutral.” UBS rebukes Apple as buy UBS reiterates its buy rating on Apple shares, noting that it sees iPhone shipments “rebounding” in China. “During May, overall smartphone shipments in China decreased by ~9% YoY despite a easing COY last year. However, shipments were up ~16% on a month-on-month basis as data from the Covid lockdown and supply chain on margins suggests a shortage. In line with our recent checks, it is decreasing.” Barclays reiterates Nike as overweight Barclays said in a note to customers that it sees China and supply chain risks rising in earnings next week. “With a tough comparison against March 2021 and an easement in YoY as of April/May 2022 as the impact of China’s lockdown, we believe there will be material pressure on NKE’s FY4Q22.” Cowen Downgraded From Under Armor to Market Performance Outperform Cowen downgraded the stock due to inflation and supply chain concerns. “UAA’s brand momentum has slowed relative to peers and expectations of a re-acceleration in growth may be challenged in an uncertain macro environment.” Mizuho reiterated to Micron as Mizuho lowered its price target on Micron from $113 to $95 per share, but said it sees a buying opportunity. “With strong execution from MU and WDC, a long-term secular trend in 5G, and consistent server strength, we believe negative sentiment and macro headwinds provide an opportunity to step up.” JPMorgan upgrades American tower from neutral to overweight JPMorgan said in the tower company’s upgrade that it sees an “acceleration in revenue”. “We still see solid home activity from existing carriers and a committed contribution from Dish, with the potential for upside over time as well as easing Sprint churn out on AMT in front of its peers.” Wedbush upgrades Chevy from neutral to outperform Wedbush says the pet company has an attractive valuation. “With relatively favorable pet category dynamics, e-commerce trends, and attractive valuations, the superior risk-reward drives us to upgrade CHWY to OUTPERFORM.”
