Here are Monday's biggest analyst calls of the day: Amazon, Apple, DiDi, Krispy Kreme, Lowe's & more
Here are the biggest calls on Wall Street on Monday: Jefferies raises price target on Microsoft to $335 from $310 Jefferies raised its price target on the tech giant and said it sees significant momentum ahead of the company's earnings report on Tuesday. " MSFT 's been a significant outperformer YTD, up 30% vs software index up 15% , setting the bar slightly higher for MSFT shares going into the F4Q print. F4Q expectations are achievable, supported by MSFT's diverse portfolio including Azure and Teams driving upselling." Evercore ISI reiterates Spotify as outperform Evercore ISI restated its outperform rating on the music streaming company and said it is bullish on Spotify' s podcasting opportunity. "Facebook also rolled out the ability for podcasters to link their shows to FB, and eventually allow listeners to create clips from them. While we think it's too early to tell whether it would be a material boost (or threat) to Spotify, we view this as one more validation of the yet to be fully unlocked Podcasting opportunity." Baird reiterates McDonald's as outperform Baird kept its outperform rating on the fast-food company and said it sees a "favorable" risk/reward. "We see potential for MCD to show upside to Q2 comps/EPS estimates, and we remain confident the company can exit the pandemic with a strong competitive position that should allow for positive operating momentum exiting 2021 and into 2022." Bank of America names Zoom a top pick Bank of America reiterated its buy rating on the teleconferencing video company and said it sees an "attractive" buying opportunity. "The control of internal and external communications should also better position Zoom to open the platform for application developers and create a marketplace." Read more about this call here. Atlantic Equities downgrades DiDi to neutral from overweight Atlantic Equities downgraded the China ride-hailing company due to regulatory uncertainty in China. "As the target of active investigations, we downgrade DiDi to Neutral as while we believe the most likely outcome will be manageable financial and operational penalties, the range of outcomes leaves us unable to recommend the stock until there is more certainty." Read more about this call here. JPMorgan initiates coverage of LegalZoom as overweight JPMorgan said in its initiation of coverage that the online legal company has the "right management at the right time." "Over the next two years we expect material revenue growth acceleration as a very experienced management team takes their learnings at companies like Intuit and applies them to the early penetration opportunity of LegalZoom." JPMorgan initiates coverage of Krispy Kreme as overweight JPMorgan said in its initiation of coverage that the doughnut company's market penetration will drive growth for the foreseeable future. "We view Krispy Kreme as a large and widely admired brand, and we believe increased accessibility will allow the company to more fully participate in the recession-resistant $650b 'global indulgence' market." Read more about this call here. Wedbush upgrades D.R. Horton to overweight from neutral Wedbush said in its upgrade of the homebuilder that it sees pricing benefits and an opportunity for investors to buy the pullback. " DHI slowed order growth in F3Q21 to rebuild spec home inventories and to maximize pricing. The resulting 17% order decline in F3Q was below consensus estimates, and last Thursday's sell off in DHI's shares was an overreaction in our view. In addition to the pricing benefits, the slower sales cadence should allow DHI's land development and community growth efforts to catch up to current demand." Goldman Sachs downgrades TAL Education to neutral from buy Goldman said in its downgrade of the Chinese online education company that it is concerned about Beijing's regulatory crackdown. "With ongoing uncertainty on the K-12 after school tutoring businesses and further risk to earnings, we downgrade EDU/ TAL to Neutral (from Buy)." Read more about this call here. Wedbush downgrades Lowe's to neutral from outperform Wedbush said in its downgrade of the stock that tailwinds are slowing. "Supported by commentary from large suppliers, we expect to see a leading indicator of a downturn emerge more clearly this quarter in HD & LOW results — declining comp store traffic — even as ticket growth remains strong. To that end, bigger-ticket remodels — particularly for above-average-income white-collar homeowners—are driving sales on the back of strong home equity gains and homeowners remodeling to support work-from-home lifestyles." Deutsche Bank reiterates Square as buy Deutsche reiterated the payment company as buy and said Square has grown faster than the major banks over the last few years. "As might be expected given the mature business models of the large banks vs. the growth potential SQ is attempting to capture, our analysis shows SQ has grown much faster than the major banks over the last 2+ years vs the banks." Wedbush upgrades Six Flags to outperform from neutral Wedbush said in its upgrade of the stock that it is a "compelling" reopening play. "Despite a sharp sell-off in recent months, we continue to think that the theme park industry is a compelling reopening play, and that SIX represents an intriguing combination of massive underperformance over the course of the pandemic, manageable reopening headwinds, and a significant-yet-realistic post-pandemic margin-enhancement story." UBS reiterates Amazon as buy UBS kept its buy rating on shares of the e-commerce giant ahead of earnings this week and said it will be "dominant" for some time. "If anything, a slight moderation in growth this quarter will help to recalibrate expectations for the next few periods. The important point is this print will serve as a healthy reminder that AMZN has a dominant position in a secular trend that will continue for some time." Deutsche Bank upgrades Gap to buy from hold Deutsche said in its upgrade of the stock that it sees improved profitability. "Since our transfer of coverage on 6/18, we have taken a fresh look at GPS and are upgrading the stock to Buy from Hold as we believe volatile trends are now largely behind the company and see a path to consistent EBIT margin gains, largely driven by a reduction in fixed costs, the mix shift to higher-margin and growth businesses (Old Navy and Athleta), improved profitability at the Gap brand with increasing consumer engagement, and demand generation investments driving market share gains." Read more about this call here. Bank of America reiterates Facebook as buy Bank of America reiterated its buy rating on the social media giant ahead of its earnings this week and said it sees more upside for the rest of 2021 due to strength in advertising. "We think the Street is expecting 2Q revenue upside post Twitter and Snap results, and Facebook management is likely to try to keep 3Q estimates as beatable, so set up is tougher into print." Bernstein names TripAdvisor as a top idea Bernstein said the online travel company is a top idea for the second half and said it has "attractive upside." " TripAdvisor' s stock has been a rollercoaster in 2021 – up 28% YTD, but peaking up > 100% before declining 40% since March. We see the set-up here as favorable, with attractive upside just from the shift away from declining meta-search to the attractive growing revenue streams of Experiences, B2B and Display advertising." Mizuho reiterates Facebook as buy Mizuho reiterated Facebook as a top pick and said it is bullish heading into the company's earnings report later this week. "We expect upward revision to consensus revenue growth of 34% YoY in FY21 due to small mid-sized businesses; and we foresee downward revisions to expense growth guidance of 34% YoY as management's forecast has been overly conservative for the last few years." MoffettNathanson upgrades Dish to neutral from sell Moffett upgraded the stock due to a lower risk of bankruptcy. "We now view that Dish' s bankruptcy risk is much lower and, to the extent that it still exists at all, has been pushed much further out. Dish Network no longer warrants a Sell rating." Benchmark reiterates Netflix as sell Benchmark reiterated the streaming giant as sell and said the company's valuation is "too generous." "We maintain our Sell rating and $448 price target on Netflix as we hone 2025 forecast and operating assumptions — while continuing to look at performance sensitivities out to 2033." Loop downgrades Palo Alto Networks to hold from buy Loop said in its downgrade of Palo Alto that the cybersecurity company's upside is "limited." "However, we believe their growth rates may have peaked given our latest findings. In addition, we believe the upside potential going forward could be more limited, as the incremental increase in the security budget is likely to be in areas that were largely ignored during the heavy security spending period since the COVID." Bank of America downgrades TAL Education to underperform from buy Bank of America double downgraded the China online education company and said there is too much regulatory uncertainty for TAL. "The policy content is tougher than expected, with continuous monitoring by the government (with dedicated administration-level department being set up) and the targets to effectively reduce the burden in one year and to achieve a meaningful outcome in three years." Baird reiterates Apple as outperform Baird kept its buy rating on shares of Apple ahead of the company's earnings report on Tuesday and said it sees a "multi-year 5G upgrade opportunity." "We expect strong FQ3 results when AAPL reports tomorrow, driven by continued strong iPhone trends and work from anywhere benefits. We'd also note that AAPL stock typically performs well in the two months leading up to the next iPhone launch, which we expect in September." Credit Suisse reiterates Apple as neutral Credit Suisse kept its neutral rating on Apple and said the company's earnings report on Tuesday likely will not be a major catalyst. "With the stock up nearly 20% from the start of June, investor focus is quickly shifting to the upcoming launch of the next iPhone this fall; we think C2Q results are unlikely to be a major catalyst." Bank of America reiterates Amazon as buy Bank of America said it sees an in line second-quarter earnings report later this week for Amazon but said it is concerned about a slowdown in e-commerce. "Despite US eCommerce headwinds in 3Q, we think Amazon will gain share, Amazon Web Services can see upside, and the stock will have support from discounts embedded in SOTP multiples vs peers."
Apple CEO Tim Cook speaks with visitors at the new Apple Store on Broadway in downtown Los Angeles, California, June 24, 2021.
Lucy Nicholson | Reuters
Here are the biggest calls on Wall Street on Monday: