Here are Friday’s biggest calls on Wall Street: Bank of America upgrades Caterpillar to buy from neutral Bank of America said in it sees a multiyear growth story for the industrial giant. “As macro headwinds ease in 6-9 months and investors look towards a new cycle, CAT’s multi-year growth prospects screen positive: capex is higher in a world that is effectively ‘short’ copper/oil/gas, long tail of fiscal stimulus drives construction projects.” Read more about this call here . Atlantic Equities downgrades Salesforce to neutral from overweight Atlantic Equities downgraded the stock due to slower-than-expected revenue growth. “We are downgrading Salesforce to Neutral on execution concerns, the broad C-suite management exodus and a risk of slower-than-expected revenue growth.” Read more about this call here. JPMorgan upgrades Copa Airlines to overweight from neutral JPMorgan said it like’s the Latin American airline’s valuation. “In our view Copa offers an interesting combination of: (i) Discounted valuation, currently trading at a 25% discount to its historical EV/EBITDA average; and (ii) a relatively comfortable balance sheet situation, with leverage expected to end 2023 at only 1.8x net debt to EBITDA, the lowest among LatAm carriers.” Guggenheim downgrades Tesla to sell from neutral Guggenheim said numbers are too optimistic ahead of Tesla ‘s earnings later this month. “We see a negative catalyst path for the stock to underperform in the near and intermediate term.” Read more about this call here. Evercore ISI downgrades Wendy’s to in line from outperform Evercore said in its downgrade of the fast food chain that it sees limited upside. “We are forecasting upside to Wendy’s 4Q and 1Q SSS and EBITDA (details on page 25). That said, we see its stock upside as more limited at $23 today.” Deutsche Bank downgrades Logitech to hold from buy Deutsche said it’s concerned about weakening PC demand trends. “We are turning more cautious on Logitech, as the current downturn in the PC market and weakening demand seems to be more severe than anticipated.” Read more about this call here . Barclays reiterates Amazon as overweight Barclays said Amazon Prime is “THE E-Commerce Killer App.” “Prime is a moat that seems unassailable to us; not only is AMZN’s retention significantly above peers, it has increased meaningfully over the past 5 years.” Goldman Sachs downgrades Lockheed Martin and Northrop Grumman to sell from neutral and Raytheon to neutral from buy Goldman downgraded Lockheed, Northrop and Raytheon and said it’s turning more cautious on defense stocks. “Defense stocks now price in the potential for a new global geopolitical super power struggle.” Read more about this call here. RBC downgrades KB Home and D.R. Horton to sector perform from outperform RBC said the homebuilder stocks have run too far too fast. “Builder stocks have continued to rally over the past month, now outperforming the S & P 500 over the past 12 months, which we believe to be too fast too soon relative to what we expect will continue to be significant pain in demand and prices/margins over the coming year.” Bank of America reiterates Alphabet as buy Bank of America said it’s standing by its buy rating on the stock, but that it sees further headcount reductions this year. “While Alphabet is somewhat insulated from investor pressure to cut costs due to founder ownership, and early cost cut actions may not have meet near-term investor expectations, over time the company has tried to match investment spending to its opportunities, and we think this first round of layoffs suggests the probability of an expense course correction in 1H’23 is growing.” Bank of America names Netflix a top pick Bank of America said Netflix is one of the best positioned media company’s for the permanent shift to streaming. “As a result, we continue to believe NFLX, DIS, and WBD are best positioned to manage this transition given their scale, depth, breadth and quality of content.” Credit Suisse reiterates AMC as underperform Credit Suisse said it’s standing by its underperform rating on AMC shares due to lack of consumer interest in returning to theaters at pre-pandemic levels. “In other words, we continue to remain cautious regarding improvements in film supply or consumer behavior returning to anywhere near pre-pandemic levels.” Bernstein reiterates Apple as market perform Bernstein said it remains concerns about iPhone supply and demand. “While AAPL stock historically does not fare well in the 3 – 6 months following iPhone launches, this year’s performance has been unusually poor, reflecting concerns about both iPhone supply and demand.” Wells Fargo downgrades AutoNation to equal weight from overweight Wells downgraded the used auto company mainly on valuation. “Thus, we are downgrading AN to EW from OW, as we believe current valuation levels are reasonable, but 2023 consensus estimates are presently too high.” Guggenheim downgrades Warner Music to neutral from buy Guggenheim said in its downgrade of Warner Music that it sees limited upside. “As detailed within, we have updated our F1Q23 model to better reflect weaker-than-previously forecast Recorded Music streaming revenue driven by 1) a continued deceleration in Ad-Supported streaming and 2) the impact of a lighter quarterly release slate (particularly relative to a stronger-than-average peer content cycle.” Bernstein reiterates Costco as outperform Bernstein said the stock remains a “solidly defensive name.” ” COST posted solid 1Q results back on 12/8/2022, and strong Dec sales numbers just last week, supporting our expectation for continued strong, stable performance.” JPMorgan reiterates Coinbase as neutral JPMorgan lowered its price target on the stock to $53 per share from $66 and said it sees a very challenging backdrop for crypto. “We see the crypto ecosystem as being very challenging for intermediaries like Coinbase, but see the expenses measures taken as good steps in managing the business — more are likely needed.”
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