- Jefferies upgraded Altria to buy from hold.
- JPMorgan named Arista Networks as top idea.
- Wells Fargo downgraded ViacomCBS to underweight from equal weight.
- Citi reiterated its buy rating on Western Digital.
- Baird upgraded Nike to outperform from market perform.
- Deutsche Bank initiated Zoom as hold.
- Evercore ISI initiated Snowflake as buy.
- Wells Fargo downgraded Discovery to equal weight from overweight.
- Stephens named O'Reilly Auto Parts a best idea.
- Bank of America reiterated NXP Semiconductors as a top pick.
Here are the biggest calls on Wall Street on Friday: Jefferies upgraded Altria to buy from hold Jefferies downgraded the tobacco company and said it had "underappreciated optionality" in vapour and cannabis. "With tobacco sentiment and value increasingly driven by reduced risk products, we see near term data points at MO as favourable. Further, while optically MO's metrics would appear to be increasingly challenged if the shift away from smokers accelerates, we think this misses significant underappreciated optionality in vapour and cannabis via M & A, especially if selling its ABI stake to fund this." JPMorgan named Arista Networks as top idea JPMorgan named the computer networking company a top pick and said investors were too bearish on Arista's cloud business and that it sees "strong growth" in other areas of the company's business. "Reiterate Overweight rating and our top pick for ANET shares where investors distracted with Cloud growth have failed to appreciate the strong growth sustainable through share gains in the Enterprise vertical alone." Wells Fargo downgraded ViacomCBS to underweight from equal weight Wells Fargo downgraded the media company and said it needs a "valuation reset." "Our blended target goes from 14x to 11x EV/EBITDA as we reduce our short/momentum premium with unchanged core + direct-to-consumer value. Like peers, we're downgrading VIAC a notch on this new valuation outlook, which takes us to Underweight and a $59 price target. After a bit more valuation reset we think things go back to fundamentals." Citi reiterated its buy rating on Western Digital Citi reiterated its buy rating on shares of Western Digital and raised its price target to $80 from $60. The firm said the stock is being helped by the current pricing as supply chains tighten. "We also find that the current disrupted supply chain environment is helping with pricing; with Citi's recent global survey of over 280 tech companies indicating general demand-driven supply chain tightness likely through 2H21." Baird upgraded Nike to outperform from market perform Baird upgraded Nike after being sidelined for more than 2 years and said it now sees a "compelling" entry point. "With the stock underperforming ~13% year-to-date and recent concerns likely to prove temporary, in our opinion, we are upgrading shares while maintaining our $150 price target, viewing the current level as providing a more compelling entry along with a favorable risk/reward when looking over the next 2+ years." Deutsche Bank initiated Zoom as hold Deutsche initiated the teleconferencing company and said it sees a "balanced" risk/reward. "We initiate coverage of Zoom with a Hold rating and $360, 12-month price target. Coming off a historic FY21 where Zoom grew 325%+ and became an integral part of daily life (it still is!), we believe the 'sequel' to the story (Zoom, post COVID) presents a more balanced risk/reward setup for shares. Evercore ISI initiated Snowflake as buy Evercore initiated the cloud-based data computing company and said it sees long-term risk/reward. "We believe there are few software firms over the last decade that have as large a growth opportunity as Snowflake and while we acknowledge that the stock is going to need to grow into its valuation near-term, we believe the long-term risk/reward and upside optionality warrants an Outperform rating." Wells Fargo downgraded Discovery to equal weight from overweight Wells downgraded the media and entertainment company and said the "non-technical premiums" were abating. "Of the Media networks operators DISCA has been and remains our favorite with a stronger core, good FCF and purely incremental DTC strategy. But, having ridden the momentum wave up it's only fair that we recognize non-technical premiums are abating, which causes us to reduce our price target and downgrade DISCA to Equal Weight. At this level we can't love it or list it." Stephens named O'Reilly Auto Parts a best idea Stephens named the auto parts company a top idea and said it sees companies like O'Reilly benefiting from the stimulus package among other things. "We are raising estimates for the auto parts group to reflect the most recently passed stimulus package and the favorable C1Q21 weather seen to date. Even with the move higher over the last two weeks, we believe there remains runway for these names to outperform in 2021" Bank of America reiterated NXP Semiconductors as a top pick Bank of America named the semiconductor company as its top pick and said the company of is "on the cusp" of driving solid results. "We maintain our Buy rating and $240 price objective on top large-cap pick NXP Semi. The recent inclusion of the stock in the S & P 500 index could enhance investor awareness, just as NXP is at the cusp of driving solid results from broad-based cyclical and secular growth drivers."
Workers install a Nike logo lamp outside the Wukesong Arena in Beijing, August 28, 2019.
Tingshu Wang | Reuters
Here are the biggest calls on Wall Street on Friday: