Here are Wednesday's biggest analyst calls: Peloton, Coinbase, Uber, Plug Power, Penn & more

Published Wed, Jan 26 20228:35 AM ESTUpdated Wed, Jan 26 20229:34 AM EST

Here are the biggest calls on Wall Street on Wednesday: Morgan Stanley upgrades DraftKings to overweight from equal weight Morgan Stanley said in its upgrade of the fantasy sports-betting company that it sees an attractive entry point. "NY results on Friday remind us that the US sports betting/iGaming market is likely to be very large, with only a handful of market-share winners. We expect DKNG to be one of them, and with sentiment at an all-time low on near-term loss concerns, we see now as a good time to invest for the long term." Read more about this call here. Macquarie upgrades Penn to outperform from neutral Macquarie said in its upgrade of gaming stock Penn that it sees "sustained" margin expansion. "Shares underperformed the gaming group in 2021. We attribute the underperformance to lower market share in online markets, tough 2022 gaming comps and questions around the founder of Barstool, Dave Portnoy, and alleged incidents that happened in the past." Stifel upgrades International Flavors to buy from hold Stifel said that it sees multiple expansion for the flavors and fragrance company. "We upgrade IFF shares to Buy from Hold and lift our price target to $160, 17x 2023E EBITDA. We do so reflecting expectations that sales growth ahead of peers since 2Q21, the first time since at least 2018, continues through 2022, resulting in multiple expansion and a reduced discount to European peers." Deutsche Bank upgrades Moderna to hold from sell Deutsche upgraded Moderna mainly on valuation. "We'll defer to the equity strategists on how much further the latter may continue, but with the stock now both through our prior PT and DCF and at a more reasonable c$65bn valuation, which is approximately 2x our YE22 expected net cash position, we upgrade to Hold." Baird reiterates Peloton as outperform Baird lowered its price target on the fitness company to $40 per share from $70 per share. The firm said it still thinks the Peloton management can "transition to balanced/profitable growth." "Despite a potentially sizable cut to F2022E guidance and ongoing balance sheet constraints, we still see substantially higher potential value for the subscription business assuming management can reinforce confidence in PTON' s ability to transition to a balanced/profitable growth model." KeyBanc reiterates McDonald's as overweight KeyBanc kept its overweight rating on the fast-food chain. The firm said it continues to be well positioned throughout the pandemic. KeyBanc also raised its price target on the stock to $285 per share from $275. "While McDonald's is not among our key ideas for '22, we believe its current growth prospects and high EPS visibility warrant an OW rating and a higher valuation." Barclays upgrades J.B. Hunt to overweight from equal weight Barclays said in its upgrade of the transportation company that it likes the company's "forward-thinking" management team. "As the pandemic is hopefully waning, we upgrade shares of J.B. Hunt, which has experienced volume challenges in the past two years." MKM names Meta Platforms a top 2022 pick MKM said in a note to clients that the company formerly known as Facebook is its "preferred value play." 'While FB faces marginally tougher comps in 1H22, we believe upcoming segment disclosure, greater discipline on metaverse-related investments, potential iOS-related tail winds, and continued shareholder-friendly behavior are near-term catalysts. FB remains the most reasonably valued tech mega-cap, and thus, an investor sentiment favoring "value over growth" could lead to stronger outperformance in 1H22." Credit Suisse names Yeti a top pick Credit Suisse named Yeti as a new top pick and said it sees margin expansion for the outdoor products manufacturer. "Top-line momentum continues on further US brand penetration, high repeat rates, a growing international business, consumer mobility and interest in the outdoors, and new products." Credit Suisse downgrades Clorox to underperform from neutral Credit Suisse said in its downgrade of Clorox that it has concerns about rising commodity costs. "We see downside risk to F22/F23 consensus estimates as consumers continue to readjust their cleaning and household purchasing needs amid rising vaccination and increasing mobility." Read more about this call here. JPMorgan upgrades Lumentum to overweight from neutral JPMorgan said in its upgrade of the telecommunications-equipment company that the recent sell-off provides an attractive entry point. "We are upgrading our recommendation on shares of LITE to Overweight to take advantage of the -10% sell-off in the shares YTD, which now presents 15% upside to our Dec. 22 price target of $110." Goldman Sachs reiterates Coinbase as buy Goldman said in a note to clients on Wednesday that it's sticking with its buy rating on the stock despite the volatility on crypto. "Despite the recent crypto market volatility, we remain Buy rated on COIN. We continue to see multiple sources of optionality over the next year that could diversify the company's revenue streams." Jefferies initiates coverage of MetLife as buy Jefferies said the insurance company is the "industry leader" in group benefits. "Bottom line, despite the tough high-level setup heading into 4Q:21 earnings, we feel the trends above still support the potential for some positive surprises in 4Q:21 results/1Q:22 outlook for MET, UNM, LNC and, to a lesser extent, PRU." Morgan Stanley reiterates Uber as overweight Morgan Stanley said in a note to clients on Wednesday that it's very bullish heading into Uber's investor day in February. "We continue to view Uber 's 2/10 Investor Day as the next key catalyst for the name ... as it is the opportunity for Uber to help investors better understand the (hopefully) underappreciated forward ride-share, delivery, freight growth and profitability ... and the monetization opportunity of Uber as a platform connecting hundreds of millions of people and businesses. Susquehanna initiates coverage of Plug Power as positive Susquehanna said it likes the hydrogen fuel company's "broad" growth strategy. "We are initiating coverage of Plug Power with a Positive rating and $26 price target. Plug is pursuing a vertically integrated strategy across the entire hydrogen ecosystem." Piper Sandler reiterates Microsoft as overweight Piper reiterated its overweight rating on shares of the tech giant after its strong earnings report on Tuesday and said it sees a favorable risk/reward. "The 1H operating margin of 44% reinforces our view that a cloud transformation has not only strengthened Microsoft' s growth prospects but also enhanced profitability." Read more about this call here. Gordon Haskett upgrades Chipotle to buy from hold Gordon Haskett said in its upgrade of Chipotle that it sees best-in-class market share gains. "We see a risk/reward profile that is now heavily skewed toward Reward for a company that is positioned to continue to deliver some of the strongest fundamentals in the sector – even when compared to the growth restaurant peer group." JPMorgan downgrades Verizon to neutral from overweight JPMorgan downgraded the telecommunications stock over concerns about subscriber growth. "We are downgrading Verizon to Neutral from Overweight and lowering our YE22 price target to $56 from $62. We are increasingly concerned about the subscriber growth outlook for postpaid phones in 2022 for Verizon and the industry overall, even beyond 1Q which is seasonally soft and where we expect Verizon to post subscriber losses." Read more about this call here. JPMorgan upgrades Avis to neutral from underweight JPMorgan upgraded the auto rental company mainly on valuation "Upgrade Avis Budget Group from Underweight to Neutral after significant stock price decline; valuation is still at a premium to Overweight-rated Hertz, however, which we continue to prefer." Morgan Stanley reiterates General Electric as overweight Morgan Stanley said in a note to clients that GE is an "earnings story primed to perform." "Shares traded down on a weak 4Q and mixed 2022 segment outlook despite slightly better FCF guidance. The path to $7B in 2023 looks conservative based on significant room for recovery in Health Care and Aviation over the next two years." Piper Sandler reiterates Beyond Meat as neutral Piper reiterates its neutral rating on the alternative meat company, but says it sees the McPlant rollout in McDonald as a positive near-term catalyst. "We remain bearish on key fundamentals for BYND, but believe a continued US McPlant rollout at MCD is likely a near-term catalyst. A national launch may come later than we initially estimated, but sell-through at test locations was ~3x our expectations, and much closer to burgers than expected, suggesting a strong initial trial." Citi opens a pair trade on Skyworks and Qorvo Citi opened a pair trade on Skyworks and Qorvo. The firm said it's concerned about smartphone exposure for the semi stocks. "We are opening a pair trade on Neutral-rated SWKS & QRVO . We see risk to Street's estimates on smartphone exposed stocks on continued weakness in China smartphone market on higher channel inventory driven by above average +10% Q/Q Q4 production vs +6% seasonality per third party data, and weaker-than-expected sell through." Bank of America upgrades American Express to buy from neutral Bank of America upgraded the credit card payment company after its robust earnings report on Tuesday. "Yesterday, AXP reported strong 4Q results and more important increased its long-term revenue and EPS outlook. AXP now aims to deliver 10%+ revenue growth and mid-teens EPS growth in a steady state economy vs. high-single-digit revenue/low-double-digit EPS growth pre-pandemic.

Peloton bike

Source: Peloton

Here are the biggest calls on Wall Street on Wednesday:

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