Here are Wednesday's biggest analyst calls of the day: McDonald's, Apple, Coinbase, Microsoft & more

Published Wed, Oct 6 20218:30 AM EDTUpdated Wed, Oct 6 20218:41 AM EDT

Here are the biggest calls on Wall Street on Wednesday: Bank of America reiterates Facebook as buy Bank of America kept its buy rating on the social media giant. The bank said regulatory risk is still an overhang but that it likely won't affect usage. "We see potential for new regulations for FB and the social industry including, requirements to share data with outside researchers, new protections for underage users (users under 13 are restricted from FB and IG), or new regulations on what content algorithms are able to amplify." Loop initiates coverage of McDonald's as buy Loop said the fast-food giant has an "aggressive and unique marketing platform." "Following a decline in MCD 's U.S. same-store sales during the early stages after the outbreak of COVID-19 (comps were down 8.7% domestically in 2Q20), the company's same-store sales quickly recovered to mid-single-digit growth during the second half of last year. MCD's comps accelerated further to 13.6% growth in 1Q21 and 25.9% growth in 2Q21." JPMorgan reiterates Apple as overweight JPMorgan said it expects a "strong selling season" from Apple. The bank also noted that supply chain risks exist, especially if there is a coronavirus resurgence. "While the supply ramp on the new iPhones have been slower than typical, beyond what was already a slightly delayed start of production due to issues with the camera module, the magnitude of those constraints are moderating at this time, and Apple is well positioned for a strong sales quarter in C4Q/F1Q." Loop initiates coverage of Dave & Buster's as buy Loop said it sees comparable sales continuing to accelerate as the economy reopens. "Looking ahead, we believe pent-up demand boost could continue to drive higher sales for PLAY for at least the next 6-12 months." Goldman Sachs downgrades JetBlue to neutral from buy and American Airlines to sell from neutral Goldman downgraded the two airline stocks and said it sees a "weaker pricing environment" and cost headwinds associated with JetBlue's partnership with American. "However, we are downgrading JetBlue to Neutral from Buy and American to Sell from Neutral for idiosyncratic reasons that will be exacerbated in a weaker pricing environment." Read more about this call here. Loop initiates coverage of Domino's as buy Loop said that it sees a "favorable environment" for delivery and takeout operators. "The company's international business should also benefit from increased at-home food consumption trends into the foreseeable future. DPZ 's international comps accelerated significantly over the last 12+ months, although unit growth was hampered by construction delays even more internationally compared to the U.S." Morgan Stanley reiterates Microsoft as overweight Morgan Stanley said its recent survey checks show Microsoft has a "dominant" market position and "reasonable" valuation. "The most recent 3Q21 CIO survey highlights Microsoft's solid position in high priority and secularly strategic areas of spend. Microsoft's topline should continue to benefit from both the favorable overall software spending outlook for 2H21 and 2022 and improving positioning against these high CIO priority items." Morgan Stanley reiterates General Motors as a top pick Morgan Stanley kept its top pick status on the automaker and said the stock is undervalued. " GM is trying to solve for de-carbonization and autonomy... two of the hardest challenges in business today – ones that requires the best people and prodigious amounts of attractively priced capital. Ultimately, we think the best measure of GM's success will come down to its ability to attract the best people and lowest cost of capital to the mother ship." Needham reiterates Tesla as underperform Needham said Tesla stock is still overvalued. " Tesla shares have rallied for the last 4 months, making the current valuation even less compelling in our view and raising downside risks. Although we are not changing our estimates at this time as we do not have the quarter's full financials, we suspect our sales and EPS expectations will go lower on the model mix shift, with additional lower ASP (average selling price) vehicles unable to make up for the loss of sales of higher ASP vehicles, with all other assumptions remaining the same." Loop initiates coverage of Papa John's as buy Loop said that the pizza company's comps continue to accelerate. "Per the latest conversations with our domestic Papa John's franchisee contacts, while consumers did start to eat out more often as markets began to re-open, eating out vs delivery/take-out trends did not return anywhere close to pre-pandemic levels. Also, a significant portion of independent pizza QSR operators were forced to close permanently during 1H21 due to the pandemic." Goldman Sachs downgrades U.S. Steel to sell from neutral Goldman said in its downgrade of the steel company that it sees negative free cash flow momentum. "That said, we believe there are opportunities to be more tactically positioned among the domestic steel participants, and we update our views to reﬂect a slightly more defensive positioning among the ﬂat steel producers. We downgrade X to Sell from Neutral on higher capital intensity driving negative free cash ﬂow momentum, Read more about this call here. Morgan Stanley reiterates Western Digital as overweight Morgan Stanley reiterated its overweight rating on Western Digital and said it sees a "strong value opportunity." "As gross margins bottom and begin to improve throughout the year investors begin to value the stock on through cycle earnings." Loop initiates coverage of Wendy's as buy Loop said that it's bullish on Wendy's breakfast opportunity. "The nationwide launch of WEN 's breakfast platform was the key driver in enabling the company to outperform most of its peers over the last 12-18 months." Morgan Stanley downgrades Seagate to equal weight from overweight Morgan Stanley said in its downgrade of the data storage company that it's starting to see "cracks in hardware fundamentals." "We downgrade our IT Hardware industry view to Cautious on deteriorating data, including a drop in CIO Hardware spending intentions and rising inventory levels. We expect performance breadth to narrow further – as a result, we downgrade CDW and STX from OW to EW." Goldman Sachs reiterates Coinbase as buy Goldman reiterated its buy rating on Coinbase and said it expects a top-line beat when the crypto company reports earnings in early November. "We expect the focus of the call to be around the regulatory environment and whether there are any signs that other new products on the crypto side could be at risk from the tightening regulatory backdrop, although we believe street models weren't baking in much in this regard." Goldman Sachs upgrades Cleveland-Cliffs to buy from neutral Goldman said in its upgrade of Cleveland-Cliffs that it sees strong free cash flow. "We see three factors drive our positive view: (1) auto contract repricing could drive upward revisions to 2022E average selling prices, (2) we see accelerated deleveraging and strong free cash ﬂow generation allows for capital allocation ﬂexibility, and (3) the shares appear discounted." Stifel reiterates Peloton as buy Stifel lowered its price target on the stock to $120 from $140. The bank also said it sees several drivers of sustainable growth going forward. "We continue to see multiple drivers for near-term growth as Peloton invests behind the recent Bike price reduction and the reintroduced Tread. Longer term, we see ongoing international expansion and new hardware opportunities as drivers of sustainable growth." Morgan Stanley reiterates Signature Bank as a top pick Morgan Stanley kept its overweight rating on the commercial bank and says it has a "highly attractive valuation." "Broadly speaking, we think 3Q21 could be a slightly better quarter than the market might be expecting, which could bode well for both earnings revisions and bank valuation multiples. Our favorite ideas include owning SBNY on exceptional balance sheet growth at a highly attractive valuation." Wolfe downgrades Delta Airlines to peer perform from outperform Wolfe downgraded Delta Airlines mainly on valuation. "Every industry is different but the 'transition year' is common to all. And though each one is unique in its own way it usually means the same thing: results won't be great. But some transition years are better than others, like the looming transition year in 2022 for the airlines, for one. And history suggests the market may be patient if results are bad but improving."

A McDonald's restaurant is pictured in Encinitas, California.

Mike Blake | Reuters

Here are the biggest calls on Wall Street on Wednesday: