Here are Wednesday's biggest analyst calls of the day: Microsoft, Moderna, Twitter, Nikola & more

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Key Points
  • Goldman Sachs upgraded Exxon to buy from neutral.
  • Stifel upgraded Chipotle to buy from hold.
  • Jefferies downgraded Moderna to hold from buy.
  • Morgan Stanley named Comcast a top pick.
  • JPMorgan upgraded Twitter to overweight from neutral.
  • Morgan Stanley upgraded HP to overweight from equal weight.
  • JPMorgan upgraded Zynga to overweight from neutral.
  • RBC downgraded Pfizer to sector perform from outperform.
  • Evercore ISI initiated Nikola as in line.
  • Credit Suisse downgraded Spotify to neutral from overweight.
  • Morgan Stanley downgraded Moderna to equal weight from overweight.
  • Stifel downgraded Etsy to hold from buy.
  • JPMorgan downgraded JetBlue and United to underweight from overweight.
  • JPMorgan downgraded Tyson Foods to neutral from overweight.
  • Bank of America reinstated Salesforce as buy and named it a top pick.
  • RBC upgraded Palo Alto Networks to outperform from sector perform.
  • JPMorgan named Coca-Cola and Constellation Brands top picks.
  • Bank of America reinstated Microsoft as buy.
Dado Ruvic | Reuters

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Here are the biggest calls Wednesday on Wall Street:

Goldman Sachs upgraded Exxon to buy from neutral

Goldman Sachs said in its upgrade of the oil and gas company that the stock was cheap and had an improved free cash flow.

"We upgrade Exxon from Neutral to Buy given potential for capital cost reductions, Guyana and Chemicals upside, improved free cash flow versus history, underweight positioning and our constructive view on crude."

Read more about this call here.

Stifel upgraded Chipotle to buy from hold

Stifel said in its upgrade of the stock that Chipotle offers some of the most compelling growth prospects in the industry.

"Chipotle has demonstrated impressive resilience during the pandemic, and we believe the brand should benefit in 2021 from increased consumer mobility and several sales-building initiatives. In addition, we believe Chipotle offers some of the most compelling unit growth prospects within the restaurant industry."

Jefferies downgraded Moderna to hold from buy

Jefferies downgraded the biotech company mainly on valuation and elevated expectations.

"Platform playing out consistent w/ our prior Buy thesis - lowering rating to Hold on significant stock run and elevated expectations. Our bullish thesis and initiation earlier this year was based on the power of mRNA and our view that its COVID-19 vaccine mRNA-1273 would successfully work and de-risk the platform and pipeline. Indeed, this has been playing out nicely and even quicker than the bulls could have hoped for."

Morgan Stanley named Comcast a top pick

Morgan Stanley named the cable and media company as a top pick and said it had some of the fastest growth in the industry.

"We see 20%+ upside to CMCSA, and our $62 price target implies the shares trade at ~16x P/E at YE21, in a market that today trades at over 20x. We expect buybacks to resume in '22. Comcast should see the fastest EBITDA growth in the industry over the next several years, building off of 2020's depressed results at NBCU and Sky."

JPMorgan upgraded Twitter to overweight from neutral

JPMorgan said Twitter would be a big beneficiary of the rebound in advertising and called the stock a top pick in 2021.

"We are bullish on online advertising in 2021 and expect industry growth to reaccelerate. We believe TWTR will show the biggest rebound given its sharper pandemic-driven ad decline, along with revenue prioritization throughout the company, early benefits from re-built ad tech through the new Ad Server and rollout of Map 2.0, and increases in both advertiser count and ad load."

Read more about this call here.

Morgan Stanley upgraded HP to overweight from equal weight

Morgan Stanley said in its upgrade of the stock that the company is a beneficiary of the economy reopening.

"HPQ stands to benefit in pandemic scenarios with diverse exposure to both consumer markets that benefit from social distancing and commercial markets that benefit as economies re-open."

JPMorgan upgraded Zynga to overweight from neutral

JPMorgan upgraded Zynga mainly on valuation and said it saw an "attractive entry point" for the social game developer.

"In our view, the valuation provides an attractive entry point for a strong executor and platform in the growing mobile games space and ahead of what we see as a solid pipeline and widening opportunity set resulting from the company's greater scale."

RBC downgraded Pfizer to sector perform from outperform

RBC said in its downgrade of the stock that the vaccine "opportunity" is already priced in.

"What PFE has accomplished in getting a vaccine to market in record time, without taking government money, is nothing short of remarkable. But we believe the 'stock' reflects the vaccine discounted cash flow opportunity, making it harder for us to argue for more meaningful upside to our price target."

Evercore ISI initiated Nikola as in line

Evercore ISI initiated Nikola and said it sees several overhangs for the electric hybrid truck company including execution, among other things.

"While there exists a WIDE range of outcomes ($3 to $47 Sum-of the- Parts), we see near-term overhangs of: 1) $1Bn+ '21 cap raise; 2) execution & 3) station partner questions, persisting through early '21. In medium-term, we see upside from significant barriers to entry once a completed core Hydrogen Trucking model is operational '23."

Credit Suisse downgraded Spotify to neutral from overweight

Credit Suisse downgraded the audio streaming and media company and said it now sees a more balanced risk/reward.

"We upgraded to Outperform in September based on our view that exclusive podcast content and market launches would drive near-term subscriber upside while gross margins would likely benefit from major label participation in marketplaces over a 3-year period. We maintain this outlook however Spotify valuation has since expanded significantly and we now see these positive factors as more priced in than not and believe the current risk/reward profile is more appropriate of a Neutral rating."

Morgan Stanley downgraded Moderna to equal weight from overweight

Morgan Stanley downgraded the biotech company mainly on valuation.

"While we expect Moderna to be a more valuable company over a multiple year period, we expect near-term valuation to be dominated by COVID-19 revenues where expectations are already high. We expect vaccines, rare diseases and oncology to be major opportunities for mRNA."

Stifel downgraded Etsy to hold from buy

Stifel downgraded Etsy mainly on valuation.

"While we remain supportive of the company and its long-term growth prospects, we see a more challenging setup for 2021 in a recovery scenario given challenging comps beginning in 2Q, expectations for less robust eCommerce growth broadly, decelerating mask sales, and volume deceleration in the home category."

JPMorgan downgraded JetBlue and United to underweight from overweight

JPMorgan double downgraded the two airline stocks on slowing demand trends.

"What began as a simple housekeeping response to disappointing but unsurprising 4Q demand trends has, instead, become a recommendation for selective profit-taking. Our earlier Overweight ratings for JBLU, SAVE & UAL are now reduced to Underweight, joining AAL & LUV, as estimated fair value for all four rests slightly below current share prices."

JPMorgan downgraded Tyson Foods to neutral from overweight

JPMorgan said in its downgrade of the stock that it sees a more balanced risk/reward.

"Although we continue to believe that TSN will benefit from improved away-from-home eating trends in CY21, we now view the risk/reward in the shares as balanced. Chicken and Prepared Foods fundamentals are likely to recover a bit this fiscal year, but these improvements could be offset but the lapping of tough comps in Beef and Pork."

Bank of America reinstated Salesforce as buy and named it a top pick

Bank of America reinstated coverage of the stock and said it believes a "long runway" still exists for the company to grow.

"We are reinstating coverage on Salesforce.com with a Buy rating and $275 PO, and view it as a top pick. Salesforce screens well in our 4M's framework for software investing - Market, competitive Moat, Management strength and Margin potential."

RBC upgraded Palo Alto Networks to outperform from sector perform

RBC upgraded the multinational cyber security company and said it had the "broadest portfolio of solutions to enable security transformation."

"We are upgrading PANW to OP and increasing our target to $380 (from $292) for the following reasons: 1) COVID changes everything and positions Palo Alto with the broadest portfolio of solutions to enable security transformations, 2) much of the heavy lifting operational changes of the past +2 years is behind them."

JPMorgan named Coca-Cola and Constellation Brands as top picks

JPMorgan named the beverage companies as top picks and said both should benefit from an economic reopening and recovery.

"The reopening calls are Coca-Cola and Constellation Brands, as both should benefit from the on-premise global recovery. As roughly half of KO's global volumes are derived from the away-from-home channel, we believe KO will be an outsized beneficiary to the broader reopening trend. While STZ's exposure to on-premise distribution is smaller we still believe STZ should benefit from the reopening given the significant momentum behind the company's beer portfolio."

Bank of America reinstated Microsoft as buy

Bank of America reinstated coverage of Microsoft and said it sees margin expansion and double-digit revenue growth over the next few years.

"We believe that the company can sustain low double digit growth in the coming 3-5 years, led by continued adoption of Azure cloud infrastructure platform, cloud based Office 365 productivity suite and more profitable Games and Game Pass revenue in the Xbox franchise."

Disclosure: Comcast is the owner of NBCUniversal, parent company of CNBC.


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