Here are Wall Street’s biggest calls on Tuesday: KBW downgrades banks to market weight from overweight KBW said in its downgrade of the banking sector that it’s getting ahead of any further moves by the Federal Reserve, and that lower rates means less profitability for banks. “Positive EPS revisions most notable in early 2022 as the prospects for higher rates worked their way into market expectations.” Goldman Sachs upgrades Pfizer to buy from neutral Goldman said that it’s bullish Pfizer’s upcoming pipeline. “Following a year of pipeline progress and activity on the M & A front, our view on the stock has changed.” Read more about this call here . Citi downgrades Robinhood to neutral from buy Citi said that Robinhood’s outlook is too murky right now. “However, we see a mixed outlook from here given potential headline risk from upcoming SEC market structure proposals, a cautious equity market outlook, and potential fallout from FTX impacting crypto trading revenues and the customer base.” Read more about this call here. Piper Sandler upgrades Pinterest to overweight from equal weight Piper said it sees multiple positive catalysts ahead. “Simply stated, we are upgrading PINS to an Overweight (from Neutral) and PT to $30 (from $25) because we see multiple tailwinds into ’23, independent from the health of the ad market.” Read more about this call here. Cowen names Home Depot a top 2023 pick Cowen said Home Depot has top notch execution in a tough macro. ” HD exemplifies best-in-class retail execution with leading Pro share and an accelerating flywheel that should serve the company well into a challenging macro backdrop into 2023.” Cowen names Airbnb a top 2023 pick Cowen said Airbnb is an “underappreciated long-term share gainer.” “While the macro overhang is real, the underlying thesis of ABNB leading a secular growth category remains intact.” Goldman Sachs upgrades Humana to buy from neutral Goldman upgraded the healthcare company and says it sees “improved competitive positioning.” “We upgrade HUM to Buy ($652 PT) given its improved competitive positioning in MA (medicare advantage).” Bernstein reiterates FedEx as outperform Bernstein said it thinks shares of FedEx could work in 2023. The company is scheduled to report earnings next week. ” FDX has underperformed the market by 14% YTD, and sentiment on the name remains as weak as we have ever seen it.” Bank of America downgrades Discover to underperform from buy Bank of America said it’s concerned about a multiple re-rating lower for the stock. “Given DFS’ relative valuation premium vs. COF (Exhibit 10), we think it is most at risk of re-rating lower and underperforming the group.” Bank of America downgrades Affirm to neutral from buy Bank of America said it’s concerned negative sentiment could “stay sticky” around the fintech company. “’22 has been very tough for investor sentiment on AFRM. While the stock is near all-time lows, we are increasingly concerned that this sentiment will remain sticky longer than previously anticipated.” Citi opening a positive catalyst watch on Nike Citi opened a positive catalyst watch on the stock ahead of earnings next week and said the worst may be behind it. ” NKE remains a battleground stock with bulls liking the China turnaround story and believing the worst of the GM pressure is behind them, while bears worry that top line guidance is too aggressive and valuation is rich. We lean more positive on a better inventory position/outlook in China. Citi names Amazon a top 2023 pick Citi said it sees Amazon gaining share in 2023. “We recognize the demand challenges facing Amazon’s retail business given macro, slowing AWS growth, and lower operating income. But we also believe Amazon can gain wallet share during these uncertain times and that adoption of AWS can accelerate through improved operating efficiencies, and hiring freezes can deliver improving operating income.” Citi initiates Wayfair and Etsy as buy Citi said it sees an attractive risk/reward outlook for Wayfair and Etsy . “With multiples still near troughs in many cases we like the risk/reward for our space in 2023.” Citi initiates Carvana as neutral Citi said the online used car company needs to focus on profitability. “In a more normalized market environment for new and used vehicles, we believe Carvana is well positioned to continue to generate share gains given the highly fragmented retail category for used cars that remains underpenetrated online.” Read more about this call here. JPMorgan initiates Mobileye as overweight JPMorgan said Mobileye has “robust fundamentals.” “Driving Ahead with Robust Fundamentals and Leadership in High-Growth ADAS/AV Markets (automotive driver assistance systems.)” Morgan Stanley reiterates Tesla as overweight Morgan Stanley said its survey data shows investors are skeptical that Tesla CEO Elon Musk will enter the smartphone market. “Elon Musk’s enterprises span transportation, energy, space, biology, and infrastructure. He wants to build a ‘super app’ ecosystem covering all his business interests. Might making a phone be going too far? JPMorgan names Monster and Estee Lauder top 2023 picks JPMorgan said Monster has a unique combination of “quality and growth.” The firm also said Estee Lauder should benefit from a U.S. recovery. ” Monster Beverages – Rare combination of quality and growth, aluminium/freight costs, stockouts abating, top line and margins improving with pricing too. …. . Estée Lauder – Recovery in the US, Travel Retail, and China into CY23, as well as channel pivot (e-commerce) should allow EL to emerge stronger in CY23.” UBS downgrades Norwegian to neutral from buy UBS said in its downgrade of Norwegian that it sees a less compelling risk/reward. “We are downgrading NCLH to Neutral from Buy following the stock’s 30%+ move since Oct, while the S & P is up +10%, since we believe the risk/return is skewed less favorably now.” Read more about this call here. Goldman Sachs names Uber, Amazon and Meta as top 2023 picks Goldman said it sees a compelling risk/reward for stocks such as Uber , Amazon and Meta in 2023. “As we look into 2023 and against the backdrop of the themes discussed in this report, we see the most compelling risk/reward in the group among a collection of large cap companies that have many of the same narratives in common, & a ‘wall of worry’ that has become more pronounced in the past six months.” Piper Sandler upgrades Block to overweight from neutral Piper transferred coverage of the stock and said in its upgrade that it sees “years” of consistent earnings growth and revenue. ” SQ is very well positioned to generate consistent revenue and earnings growth over the next several years due to increasing subscription-based revenue growth from Square customers. Stifel initiates Hayward Holdings as buy Stifel said it’s bullish on the pool company’s growth prospects. “We estimate the U.S. pool category will approach $26 billion in 2022 sales; the U.S. category is the primary driver of our companies under coverage, with pressure on housing/housing related spend top-of-mind. … .We are initiating coverage of Hayward Holdings with a Buy rating and $11 target price predicated on the shares achieving parity with residential focused equipment manufacturers.”
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