Here are Thursday’s biggest calls on Wall Street: UBS downgrades Splunk to neutral from buy UBS said it sees “growth challenges” for the software company. “We’re downgrading our rating on Splunk shares to Neutral from Buy post a fresh round of industry checks that helped clarify the root cause of Splunk’s recent $250m FY23 ARR guidance cut.” Oppenheimer upgrades Verizon to outperform from perform Oppenheimer said that, after several years, the firm finally sees the shares as attractive. “After almost two years, we’re getting constructive on Verizon again, upgrading shares to Outperform and introducing a $50 price target.” Read more about this call here. Wells Fargo downgrades Silvergate to underweight from overweight Wells said the crypto bank’s growth outlook is limited. “We continue to believe these are early days of broader digital asset adoption, but the growth outlook for SI as a pure-play crypto banking solution is significantly limited in the current environment.” Read more about this call here. Goldman Sachs upgrades Take-Two to buy from neutral Goldman said in its upgrade of the video game company that macro headwinds are already priced into the stock. “While the gaming industry continues to face a number of short term fundamental headwinds, we see those headwinds increasingly priced into TTWO shares (especially when measured against the potential for upside nodes in the next few years).” Deutsche Bank adds Tesla to the fresh money list Deutsche Bank said 2023 is a “pivotal year” for the automaker. “We view 2023 as a pivotal year for Tesla in which it will continue to grow volumes at a high pace, enter new segments with Cybertruck and Semi, optimize its manufacturing and cost footprint, and benefit from IRA which will lower its costs and boost demand.” Goldman Sachs reiterates Target as buy Goldman said Target is still a “retail secular winner” despite a tough macro outlook. “While many investors we speak to think the set up is attractive for FY23, the key focus is better understanding the risks into year-end.” Goldman Sachs upgrades Pinterest to buy from neutral Goldman said it sees “upside to revenue growth” for the stock. “While the digital advertising landscape remains mired in uncertain times we upgrade the shares of Pinterest from Neutral to Buy and raise our PT from $24 to $31 on the back of improved user growth/engagement trends in the short/medium term and the potential for upside to revenue growth trajectory and operating margin estimates as we move into 2023/2024.” Read more about this call here. Mizuho reiterates Rivian and Tesla as buy Mizuho slightly adjusted its price targets lower on shares of Rivian and Tesla, but said the stocks are generally well-positioned. “Despite some near-term challenges, we continue to see vertically-integrated EV companies TSLA , RIVN and NIO well-positioned with secular growth drivers as legacy auto OEMs struggle to balance ICE/ EV portfolios.” Barclays upgrades Transocean to overweight from underweight Barclays said in its double upgrade of the oil and gas drilling company that Transocean’s “Middle East activity [is] gaining momentum and offshore [is] suddenly relevant again.” “On the other hand, North American activity is starting to approach peak utilization with limited availability of rigs and pressure pumping equipment. But while the North American cycle may be reaching its upper limit in terms of cadence, the upside in 2023 net pricing is considerable.” JPMorgan downgrades AutoNation to neutral from overweight JPMorgan said in its downgrade of AutoNation that it’s concerned about a deteriorating macro outlook. “The setup for franchise dealers into 3Q22 earnings is the most negative we have encountered since the pandemic.” Evercore ISI initiates ZScaler and CrowdStrike as outperform Evercore said it’s very bullish on the cyber industry. “We are initiating coverage on cybersecurity with a bullish view that the secular trends powering a ~$100bn TAM growing at a ~8% CAGR are durable even in a tougher economic backdrop.” UBS reiterates Apple as buy UBS said Apple demand for the high-end iPhone is “holding up.” “The stronger demand at the high-end is largely offset at the low-end as we expected based on our checks and analysis of procurement patterns.” Canaccord initiates Penn as buy Canaccord said the gaming stock is well priced. “Shares of PENN have remained under pressure amid broader market volatility, and at current price levels, despite the potential for an economic recession, we think investors can gain access to a very reasonably valued, consistent, and strongly profitable regional casino business with upside from participation in the rapidly expanding OSB and iGaming markets.” Goldman Sachs upgrades Steel Dynamics to buy from neutral Goldman said the steel company has earnings potential. “We upgrade STLD from Neutral to Buy, as we believe (1) still-underappreciated downstream earnings potential could drive consensus earnings revisions higher, (2) further capital returns potential as free cash flow generation remains robust.” JPMorgan upgrades Credit Suisse to neutral from underperform JPMorgan said Credit Suisse has “material long term revaluation potential.” “While recent negative news flow and market reaction may impact franchise value near-term, we expect this to be resolved post clarity on restructuring.” JPMorgan downgrades Nasdaq to neutral from overweight JPMorgan said in its downgrade of Nasdaq that it sees some near-term uncertainty. “After positioning high quality assets to take advantage of large secular trends that leverage software and data, we think Nasdaq is at a key juncture to accelerate utilization/user engagement and benefit from pricing dynamics.” Argus upgrades Fox to buy from hold Argus said the media company should be a beneficiary of increased political advertising. ” Fox has differentiated itself from its Hollywood peers by not following the stampede into subscription video-on-demand (SVOD), thereby saving millions in costs.” Bank of America reiterates Apple as buy Bank of America said it’s App Store analysis on Apple shows a “positive and negative inflections in consumer spending sentiment.” “Our analysis suggests that app store spending can signal both positive and negative inflections in consumer spending sentiment.”
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