Here are Tuesday's biggest analyst calls of the day: Microsoft, Apple, Tesla, Micron, Exxon & more

Published Tue, Dec 7 20218:34 AM EST

Here are the biggest calls on Wall Street on Tuesday: MKM upgrades Starbucks to buy from neutral MKM said in its upgrade of the coffee giant that investors should look past any short-term hurdles and buy the weakness in the stock. "We are upgrading Starbucks to Buy, from Neutral, taking a more constructive view of its LT prospects, while acknowledging the current backdrop, investments, and fundamental drag may weigh on its near-term performance." Read more about this call here. JPMorgan upgrades Murphy Oil to overweight from neutral JPMorgan said in its upgrade of the stock that it sees a free cash flow inflection point by the middle of 2022. " MUR's FCF metrics move from below average to near the top of the peer group starting mid-year 2022. From 2022-25, we estimate $3.6 billion of FCF vs. the current market cap of $4.2 billion." William Blair names Planet Fitness a top 2022 pick William Blair called the fitness company a top pick for 2022 and said it likes the limited supply chain exposure. "We believe Planet Fitness' s stock is poised to perform well in 2022, given an ongoing rebound in membership, revenue, and profitability trends alongside limited exposure to supply chain and labor constraints (the latter reflecting its franchised model alongside its easy-to-operate club format)." JPMorgan upgrades CarMax to overweight from equal weight JPMorgan said in its upgrade of the auto company that it has "better capacity/labor position" compared to peers. " KMX on the other hand, despite the recent re-rating, seems better positioned, with growth set to show acceleration in F3Q, less fear around peak GPU (gross profit per unit) and relatively better capacity/labor position vs on-line peers." Evercore ISI downgrades Linde to in line from outperform Evercore said in its downgrade of Linde that its downgrade of the chemical manufacturer is more about the "defensive nature" of the business. "That said, we need to evaluate our ratings on a 'fresh money' forward basis and here we see less opportunity for meaningful outperformance in 2022 unless broader economic growth slows markedly from our base case. As such our downgrade here is more about the defensive nature of the business than any nit in regards to valuation or strategy.' Wells Fargo initiates coverage of Scotts Miracle-Gro as overweight Wells said that it likes the consumer lawn company's fundamentals. "After 8 months of red (the stock), SMG is flashing green. On CY23e, SMG is 10xEBITDA/14x EPS. We see opportunity: a stock well off April highs, a discount to peers, and fundamental opportunity - leader in lawn/garden and hydroponics — still ahead." Wells Fargo initiates coverage of Canopy Growth as underweight Wells said the cannabis company is overvalued. "We are initiating coverage of Canopy Growth Corp (CGC), a diversified consumer company involved in the sale of cannabis where federally legal, as well as other non-cannabis products, with an Underweight rating and $8 price target." Loop initiates coverage of Stryker as buy Loop said the medical technology company has "best-in-class" execution. "We are initiating coverage of SYK with a Buy and $305 PT. SYK remains a premier diversified medical device company with best-in-class execution that consistently churns out predictable above market mid- to high-single-digit top-line growth and double-digit bottom line growth, which despite the recent COVID related pull back appears poised to deliver in 2021 and 2022." Morgan Stanley raises price target on Apple to $200 from $164 Morgan Stanley raised its price target on the tech giant and said it sees upside to estimates as new products get priced in. "We are cautious on IT Hardware entering 2022, but Apple should benefit from a flight to quality especially as upside from new product categories gets priced-in, now reflected in our $200 PT. Near-term, iPhone supply and App Store are surprising to the upside and drive our December quarter estimates higher." Read more about this call here. UBS raises price target on Tesla to $1,000 from $725 UBS reiterated its neutral rating on the automaker, but the bank also said no company can "come even close" to Tesla. " Tesla is likely to continue beating consensus expectations also in 2022 in terms of top line growth and margins, in a global EV market that keeps accelerating rapidly. Tesla's structurally better access to chips and batteries through vertical integration is a key differentiator vs. most competitors and should help to cement Tesla's market leadership with ~20% global BEV share, in combination with industry-leading profitability." Read more about this call here. Evercore upgrades Restaurant Brands to outperform from in line Evercore said in its upgrade of the owner of Burger King that it's bullish on Restaurant Brand's Justin Bieber promotion. "The successful Justin Bieber promotion is providing an additional near-term lift to loyalty membership and already-improving multi-year sales trends. We have seen important foundational improvement at the brand (47% of EBITDA), including loyalty, digital marketing, food innovation and coffee improvements." Deutsche Bank upgrades Jack in the Box to buy from hold Deutsche said in its upgrade of the fast food chain that it's bullish on the company's announcement it will acquire Mexican chain Del Taco. "Given the better set-up post earnings, the TACO deal (which we like), and the current price of the stock, with this note, we are upgrading shares of JACK to Buy, up from Hold prior." Goldman Sachs reiterates Exxon as buy Goldman Sachs said in a note to clients that the oil and gas giant is still the best risk/reward in the firm's coverage. "For Exxon, we highlight that despite weaker European reﬁning margins and some pressure on the chemicals chain, the company is set to continue to drive Brent free cash ﬂow breakevens." Morgan Stanley reiterates Microsoft as overweight Morgan Stanley reiterated its overweight rating on shares of Microsoft and says the stock has "reasonable multiples." "In the near-term, lacking a firm bottom for high multiple names, we favor 1) core franchise stocks with reasonable multiples – names like ADBE, INTU and MSFT would top our list here, and 2) names with fundamentals set to turn and trading at reasonable multiples – CRM and PANW should both see accelerating FCF growth into CY22, which is not reflected in current multiples." JPMorgan upgrades Bumble to overweight from neutral JPMorgan said in its upgrade of the dating app company that it has increased confidence in the stock after meeting with the company's management. "Following IRL investor meetings with Bumble mgmt last week, we are upgrading shares of BMBL to Overweight with a $55 Dec-22 PT. We have long been positive on the secular growth opportunity within online dating, with only ~25% of global singles using online dating products & the pandemic accelerating the shift of dating online." Cowen downgrades Ross to market perform from outperform Cowen said in its downgrade of Ross that margin estimates are too high. "We remain constructive on long-term market share opportunity, but consensus estimates underestimate product cost inflation, supply chain inflation, and wage inflation into FY22, which is likely to pressure gross margin on stimulus led sales comparisons." Citi reiterates Micron as buy Citi said in a note to clients on Tuesday that it expects a "DRAM upturn" for Micron in the second half of 2022. DRAM is a type of semiconductor memory cell. "We have a Positive Catalyst watch on Micron and are maintaining our above-Consensus estimates. Our F22 EPS estimate is roughly 8.0% above Consensus. We believe peak EPS can go to $16.00 (at least) as we expect strong upside to DRAM pricing in 2H22." Wolfe initiates coverage of XPO Logistics as outperform Wolfe said that it sees a "margin turnaround" opportunity for XPO . "The stock has materially underperformed since the spin of its Logistics segment and following disappointing 3Q LTL (less than truckload) results. But past periods of underperformance have historically led to good buying opportunities, and we see a margin turnaround opportunity the next few years given positive LTL pricing fundamentals and a renewed focus from management."

Microsoft CEO Satya Nadella gestures while speaking during a company event in San Francisco.

Robert Galbraith | Reuters

Here are the biggest calls on Wall Street on Tuesday: