Here are Tuesday’s biggest calls on Wall Street: Atlantic Equities names Coca-Cola as a top 2023 pick Atlantic Equities said it sees “category momentum” for shares of the beverage giant. “Our preferred names remain Coca-Cola and Pepsi where we see category momentum, ongoing investment and strong execution supporting elevated growth.” Morgan Stanley upgrades Conagra to overweight from equal weight and downgrades Hostess to equal weight from overweight Morgan Stanley said Conagra should benefit from consumers eating at home. The firm also downgraded Hostess mainly on valuation. “Prefer snacking & better-for-you (BFY) names (MDLZ, BRBR, VITL), but leaning more positive on select center-store names; upgrade CAG to OW and moving to EW on SJM (upgrade) and TWNK (downgrade).” JPMorgan reiterates Apple as overweight JPMorgan cut its price target on Apple to $190 per share from $200 due to supply chain challenges concerns. “While the rapid extension of lead times for the iPhone 14 Pro / Pro Max has slowed down and in fact began to moderate in recent weeks, it still remains elevated relative to the lead times seen prior to the COVID outbreak in Zhengzhou as we continue to see the supply shortfall continuing through year-end and impacting the typical seasonal uptick in iPhone volumes seen in Dec-Q.” Read more about this call here. Evercore ISI reiterates Tesla as in line Evercore lowered its price target on shares of Tesla to $200 per share from $300 on concerns about demand. “While we continue to view TSLA as having a leading EV gross margin advantage from global scale, vertical integration, & US IRA benefits, it is impossible to ignore that investors are already well aware of these benefits but now must ALSO battle test demand assumptions for ’23-25.” Read more about this call here. JPMorgan names Amazon as a top 2023 pick JPMorgan said Amazon is the “most diversified mega-cap across revs/profit & has numerous large growth opportunities.” “Retail Acceleration, Increasing Cost Discipline, & Secular Cloud Growth Drive FCF Inflection in ’23.” Wells Fargo names Disney a top 2023 pick Wells said it’s bullish on Robert Iger returning to lead the company. “We think Bob Iger is returning to DIS to make big changes. Spinning ESPN/ABC is the best path forward and we see it as a reasonably probable late-’23 event. Splitting would leave remaining DIS as an attractive pureplay IP company.” Jefferies names Caterpillar and Deere top 2023 picks Jefferies named Caterpillar and Deere top 2023 ideas and said the machinery sector can grow. “For 2023, we continue to be focused on several tectonic shifts, including decarbonization, reshoring, de-globalization, an inflection in industrial technology and massive infrastructure spending — all of which are unprecedented (read: different) vs. recent cycles.” Cantor Fitzgerald initiates Rivian as buy Cantor said the electric vehicle company has a “differentiated” offering. “We believe RIVN benefits from a differentiated product offering, a strong backing from Amazon and a proprietary charging network. RIVN’s shares are down ~79% YTD, so we believe this could be a good entry point for new investors.” JPMorgan resumes DuPont as overweight JPMorgan resumed coverage of the stock and said it sees several positive catalysts ahead. “Despite cyclical risks, we do not believe that the standing stock price fairly reflects the earnings power and quality of the remaining DD portfolio, a disconnect that should continue to remedy over the next 12 months.” Oppenheimer reiterates Netflix as outperform Oppenheimer said it’s bullish on Netflix heading into next year. “We believe NFLX stock will be driven by subs, not revenue, and data on viewership (80% of Nielsen’s Top Ten) are indicative of in-line or better subs.” JPMorgan adds Juniper to the focus list JPMorgan named the networking hardware company as a top pick and says it’s resilient. ” Juniper remains well positioned for resilience to the macro backdrop led by a combination of: 1) relatively lower downside risk to spending expectations for Cloud and Service provider customers compared to Enterprise; 2) opportunity for share gains in the Enterprise vertical, led by a revamped portfolio.” JPMorgan downgrades Whirlpool to neutral from overweight JPMorgan downgraded the stock due to concerns about margin sustainability. “we downgrade WHR to Neutral from Overweight, as well as remove the stock from the U.S. Analyst Focus List, as while we continue to view the stock as inexpensive, currently trading at only roughly 5.2x our 2023E EBITDA, we believe that investor concerns regarding the sustainability of North American margins will continue to impact valuation.” UBS names Micron and AMD top 2023 picks UBS said the semis backdrop looks “challenging” but that it sees a “recovery” for stocks like Micron and Advanced Micro Devices. “We expect a challenging macro backdrop to persist through much of 2023, though a China re-opening will likely provide some ballast to weakening US/Europe. Nonetheless, we are bullish on semiconductor stocks for 2023 – expecting stock momentum to really build into CQ2 and 2H:23 before the ISM likely bottoms late in the year.” BMO upgrades Beam to outperform from market perform BMO said in its upgrade of the biotech company that it sees an attractive risk/reward. “In 2023, however, we expect two key catalysts from Beam’s partner Verve to drive upside in BEAM, while incremental updates from Beam’s pipeline programs and/or new partnership announcements can also drive BEAM higher.” Barclays names Merck a top 2023 pick Barclays named the biopharma company as a top pick and says the stock is “compelling.” “After two years of selecting LLY as our preferred name, we move back to MRK given what we see as compelling combination of solid operational performance.” Credit Suisse downgrades Home Depot to neutral from outperform Credit Suisse downgraded Home Depot due to concerns about slowing home sales. “Our Neutral stance in Home Improvement is partially based on both our quarterly Home improvement macro piece – and Credit Suisse Monthly Survey of Real Estate Agents in November indicating buyer traffic remains anemic despite some softening in mortgage rates.” Read more about this call here. Baird downgrades Generac to neutral from outperform Baird said in its downgrade of Generac that it sees too many missteps right now. “Long-term dynamics remain intact, but stock does not work until HSB (home and small business) bottoms/ shows signs of inflecting and clean energy momentum reemerges (after recent missteps), which are unlikely until 2H23 at earliest.” JPMorgan downgrades Stitch Fix to underweight from neutral JPMorgan downgraded the stock after a “tough year.” ” SFIX has had a tough year, with shares down 82% YTD. SFIX has struggled with its transition to a Fix + Freestyle model, which has been amplified by the current macro environment and resulted in four straight qtrs of active client declines.” Raymond James initiates Tapestry as outperform Raymond James initiated the owner of brands like Coach and Kate Spade that expectations are “low.” “We initiate coverage on Tapestry (TPR) with an Outperform rating and $44 price target. We think expectations are low and already reflect macro headwinds affecting most global brands (softer N. America demand, China COVID pressure, higher costs, FX).” Evercore ISI upgrades Union Pacific to outperform from in line Evercore upgraded Union Pacific mainly on valuation. “The ability to post volume growth and maintain margins will be almost as important as relative valuation, where we also see opportunities.” JPMorgan names Bank of America a top 2023 pick JPMorgan said it likes the stock due to a “lower share of nonprime consumer loans.” “We prefer stocks with lower credit risk and/or other catalyst. Among bigger banks, we prefer Bank of America due to lower share of nonprime consumer loans.” Evercore ISI names Microsoft and Snowflake top 2023 picks. Evercore said Snowflake is its favorite “high growth” idea for 2023. The firm also says Microsoft offers both “offense and defense.” “Our favorite ideas include: MSFT (top idea), INTU, NOW, ADBE, and WDAY with SNOW being our favorite ‘high growth’ idea for those that want to add more offense to the portfolio.” DA Davidson reiterates Roku as buy The firm said it’s sticking with its buy rating on shares of Roku. “The company will likely continue to focus on the three pillars of its business model: 1) engagement, 2) monetization, and 3) scale.”
