Here are Tuesday’s biggest calls on Wall Street: Bank of America adds Warner Brothers Discovery to the US1 list Bank of America said it likes the media company’s “long-term potential.” “We continue to remain bullish on the long-term potential of WBD and view the current risk/reward as highly attractive.” Goldman Sachs names Charter a top 2023 pick Goldman said the cable company is a very attractive pick in 2023. “We expect CHTR’s broadband net adds to show improvement throughout 2023 driven by it rural footprint expansion, network upgrades, and moderating levels of fixed wireless net adds.” KeyBanc upgrades Bumble to overweight from sector weight KeyBanc said it sees an attractive risk-reward outlook for the dating company. “We believe BMBL shares offer attractive risk/reward (20% downside in Bear scenario vs. +84% upside in Bull scenario).” Read more about this call here . Barclays names Microsoft a top 2023 pick Barclays said Microsoft remains a “heavyweight” in 2023. “Microsoft continues to be a heavyweight in the software space propelled by a continuous digital transformation spending environment and its breadth of offerings.” Morgan Stanley downgrades Boeing to equal weight from overweight Morgan Stanley downgraded the stock mainly on valuation. “We downgrade BA from OW to EW as we see the stock approaching fair value at these levels after its recent outperformance.” Read more about this call here . Morgan Stanley names Taiwan Semiconductor a catalyst-driven idea Morgan Stanley said it’s bullish heading into the semiconductor company’s earnings later this week. “Comments on 2023 full-year guidance and semi cycle recovery are keys to watch. Stay OW on TSMC into results.” Guggenheim reiterates Disney as buy Guggenheim said it’s concerned about a weak theatrical performance from Disney but that’s it’s sticking with its buy rating. “We anticipate an intense focus on pursuit of incremental profitability in conjunction with an ongoing commitment to investing in the creative process. Our BUY rating and $115 price target are unchanged.” UBS upgrades US Bancorp to buy from neutral UBS said in its upgrade of US Bancorp that its resilience is “underappreciated.” “With no discernible themes (e.g., 2022’s rate trade), we prefer stocks where fundamental improvements and/or EPS resilience is underappreciated.” Bank of America names Delta a top 2023 pick Bank of America said it likes the airline company’s free cash flow generation. “We maintain our Buy rating on DAL and $43 price objective. DAL’s expected return to more meaningful free cash flow generation in 2023 (target of > $2B vs BofAE of $2.3B) and 2024 is the biggest differentiator among the big four airlines.” Goldman Sachs reiterates Netflix as sell Goldman said it sees too many negative catalysts heading into Netflix earnings next week. “In addition, we remain concerned that additional subscriber offerings could cause ‘spin down’ into the lowest-priced plans by users in any potential consumer recession over the next 6-12 months.” Evercore ISI upgrades Travelers to outperform from in line Evercore said in its upgrade of the insurance company that it sees earnings power in 2023. “We are upgrading TRV to Outperform from In Line as we believe stronger-than-expected earnings power will be more apparent as we move through ’23.” Wells Fargo upgrades AT & T to overweight from equal weight Wells said the stock is defensive and has a “reasonable” valuation. ” T is our top wireless pick of 2023, as (a) we see upside to lowered EBITDA and FCF consensus expectations, driven by strong wireless service revenue (+4%) and EBITDA growth (+6%); [and] (b) an improving balance sheet should open up share repurchase optionality.” Read more about this call here. RBC downgrades Box to underperform from sector perform RBC said it has concerns about the cloud-based content management company’s turnaround. “While Box’s turnaround has been impressive with 2,200 bps of operating margin expansion since FY20, growth acceleration led by Suites and Japan, and yielding a positive stock return in 2022 (only one in our coverage), we now have concerns on the sustainability of this turnaround, especially given our checks indicate growth in Japan could continue to slow.” Oppenheimer reiterates Coinbase as outperform Oppenheimer said it thinks the crypto company is a “long-term survivor.” ” Coinbase can be one of the few long-term survivors in this space, which we think makes it attractive.” Read more about this call here. Morgan Stanley downgrades Royal Caribbean to underweight from equal weight and upgrades Norwegian to equal weight from underweight Morgan Stanley made several rating changes to its cruise coverage and said booking sentiment continues to be “mixed.” “We switch our ratings on RCL (UW to EW) and NCLH (EW to UW), and lower our CCL forecasts post Q4 and now expect a fourth year of losses in FY23.” Read more about this call here. Morgan Stanley resumes Virgin Galactic as equal weight Morgan Stanley resumed coverage of the space flight company and says it has first mover advantage. “We are bullish on SPCE’s LT potential as a first mover in a structurally high-margin business, but our optimism is tempered by the execution track record and steep ramp ahead.” UBS downgrades Waste Management to neutral from buy UBS said in its downgrade of the stock that it thinks “investors will need more than safety to drive further multiple expansion in 2023.” “We remain relatively positive on the MSW medium-term risk/reward profile, including WM & RSG. However, we expect investors will need more than safety to drive further multiple expansion in 2023.” Mizuho upgrades Exxon to buy from neutral Mizuho resumed coverage of the stock and said in its upgrade that it sees margin expansion. “Thus, in our opinion it is hard to construct a scenario where XOM could not be a leader in cash generation and cash returns within our Energy coverage group for the next 3-5 years.” Morgan Stanley reiterates Spotify as overweight Morgan Stanley said Spotify has several levers to pull and that it’s a self-help story. “There are clear levers it can pull in almost any macro environment to help improve its P/L and its share price in 2023, if it chooses. First, it has the opportunity to raise prices on the subscription business that drives nearly 90% of its revenues.” JPMorgan reiterates Apple as overweight JPMorgan said it appears that iPhone lead times are moderating for Apple. “In Week 18 of our Apple Product Availability Tracker, supply-demand dynamics for iPhone Pro models made further progress in relation to reaching normalization across several regions, with Pro lead times now tracking less than a week in the U.S., U.K., and China.” JPMorgan reiterates Amazon as overweight JPMorgan said it’s standing by its overweight rating on the e-commerce giant but that its investor survey checks show Meta will be a better mega-cap performer this year. “META is expected to be the best performing mega-cap stock (41% of respondents), w/ AMZN a close #2 at 36%, while NFLX is expected to be the worst-performing mega cap.”
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