Here are Friday’s biggest calls on Wall Street: JPMorgan reiterated FedEx as overweight JPMorgan said it’s standing by shares of FedEx but noted that cautious going into earnings later this month. “The stock has underperformed the S & P 500 and XLI since the investor day which lacked details on how much of the profit improvement goals were tied to cost reductions in FedEx’s control.” Wells Fargo names Zscaler a top pick Wells named the cloud security company a top pick after its robust earnings report on Thursday. ” Zscaler reported exceptionally strong F4Q (Jul) results, beating the high-end of revenue guidance by 3.9%. Billings were also strong, growing 57% Y/Y, which was an acceleration from Q3 (+54%).” Morgan Stanley upgrades Regeneron to overweight from equal weight Morgan Stanley said it’s bullish on Regeneron’s wide range of products which should deliver durable revenue. “Overall, we now see REGN as the preferred large cap growth name supported by a range of products delivering durable revenues and a advancing oncology pipeline with the potential to diversify the base business.” Read more about this call here . Bank of America reiterates Starbucks as buy Bank of America said its bullish on Starbucks ‘ new CEO. “We believe the recently announced appointment of Laxman Narasimhan as incoming CEO starting in April goes a long way toward lifting the overhang presented by succession concerns given the high regard in which he is held by investors.” Bank of America reiterates Citi as buy Bank of America said it sees several “idiosyncratic catalysts” in the months ahead for Citi. “We also believe that the stock will become easier to own as the noise tied to business exits is behind and investors can more cleanly track progress toward management targets laid out during the March investor day.” Guggenheim downgrades Enphase Energy to neutral from buy Guggenheim downgraded the energy company mainly on valuation. “We are downgrading ENPH from Buy to Neutral based on our belief that the stock is now fairly valued and that upside to our estimates is unlikely.” Citi reiterates Albemarle as buy Citi said its long term thesis is intact for shares of the lithium company after a meeting with Albemarle management. The firm raised its price target to $345 per share from $294 and says it’s a top pick. “ALB has aggressively restructured contracts to more variable pricing and is better positioned to benefit from higher prices compared to last cycle (2015-2018). ALB benefits from both higher lithium pricing and higher volumes from its global footprint in Chile, Australia, and China.” Loop initiates Academy Sports as buy Loop said in its initiation of the sporting goods store that it has an attractive business model. “We believe Academy’s unique business model, including a wide product assortment, value price focus, and localized merchandising drives industry-leading financial metrics. We think Academy’s recent resumption of new store openings could result in up to $2 billion of incremental annual revenue.” Daiwa upgrades Coinbase to buy from outperform Daiwa upgraded Coinbase after what it calls the “recent share-price retracement.” “Reaffirming our Positive rating on the sector; upgrading Coinbase to Buy (1) after the recent share-price retracement.” Barclays downgrades Navient to equal weight from overweight Barclays said it sees a “material risk” to earnings due to the student loan forgiveness plan. “As more details emerge, it’s become clear that FFELP loans are meant to be included in the Administration’s loan forgiveness plan. We believe a material portion of NAVI’s portfolio (60-80%) could be under the income limit and estimate ~20-28% downside to our 2023 EPS estimate.” Read more about this call here. Morgan Stanley names Biomarin Pharmaceutical a catalyst driven idea Morgan Stanley said it expects the FDA to approve a filing for the company’s hemophilia drug. “Management plans to re-file its BLA of Roctavian for Hemophilia A in the US in September with an FDA decision on acceptance by October. We expect the FDA to accept the filing which could drive BMRN up 5-10%+.” Bank of America reiterates Rivian as buy Bank of America noted the electric vehicle company remains a “competitive threat to incumbent automakers.” “We maintain our Buy rating on RIVN, which is predicated on our view that the company is one of the most viable among the start-up EV automakers and also a relative competitive threat to incumbent automakers.” Bernstein downgrades Virgin Galactic to underperform from market perform Bernstein downgraded the stock due to continual flight delays. “We downgrade Virgin Galactic to Underperform, with a price target of $4. Q2 results follow a pattern over the last two years that has meant delay of future flight operations, redesign of elements of its platform, and a need to raise more cash.” Read more about this call here. Morgan Stanley names Amazon a top ad pick Morgan Stanley said the e-commerce giant was its favorite pick within advertising. “Our Internet sector Top Pick overall (and Top Pick within Ads) is AMZN ($175 PT with ~35%upside) given improving retail profitability. AMZN also has a ~$38bn annual, performance-driven ad business expected to grow at a ~22% ’22-’24 rate with CTV and video call optionality.” Morgan Stanley reiterates Disney as overweight Morgan Stanley says Disney shares are undervalued. “We remain OW DIS as we see the high-multiple Parks segment driving the majority of EBITDA and FCF over time, while Disney’s content assets are under-earning and undervalued.” Bank of America initiates Omnicell as buy Bank of America said in its initiation of the medication management solutions company that Omnicell is well-positioned to “capitalize on future automation trends.” “This valuation is a small premium to the Health IT and medical technology peer group average of ~16-17x given its favorable competitive positioning and EBITDA margin upside relative to peers.” Read more about this call here . Barclays reiterates Peloton as overweight Barclays said Peloton ‘s churn in August was “attractive and low.” “Based on Barclays credit card data, implied churn is tracking at roughly ~1% vs our estimate of 1.2%, suggesting slight upside to PTON’s guide of 2.97M Connected Subs for F1Q23.” Bank of America downgrades Sonic Automotive to underperform from buy and CarMax to underperform from neutral Bank of America downgraded several auto companies due to concerns about macro headwinds. “As a result of our lowered estimates and as we rebalance ratings in consideration of cluster requirements we are downgrading a number of stocks including: American Axle (AXL) from Buy to Neutral, Sonic Automotive (SAH) from Buy to Underperform, and CarMax (KMX) from Neutral to Underperform.”
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