Here are the biggest calls on Wall Street on Wednesday: Goldman Sachs reiterates Apple as neutral Goldman said in a note to clients that it's cautious heading into Apple earnings on Thursday and that it's more important than usual "given increased focus on consumer spending." "Looking ahead, we believe the combination of supply chain issues from lockdowns in China, a slowing App Store and the potential for slowing consumer demand increase risk for Apple's guidance and commentary around FQ3 to June." HSBC upgrades Schlumberger to buy from hold HSBC said in its upgrade of the oil field services company that it sees improving fundamentals for Schlumberger. "Solid cash flow generation and increased dividend should result in improved shareholder returns." Loop reiterates McDonald's as buy Loop said in a note to clients that its survey checks show same-store sales growth is off to a "solid start.' "Looking further ahead, our contacts indicated the company is planning to launch an upgraded offering in late 2022 that will impact all burgers on the McDonald's menu. Corporate is currently calling this platform 'Better Burger' but respondents expect this name to change by the time it is officially launched." HSBC upgrades Halliburton to buy from hold HSBC said in its upgrade of the oil field services company that the environment is favorable for the stock. "With increasing activity in the North American oil market, we think Halliburton is well placed to capitalize compared to its peers due to its higher exposure to this market. We think the pricing environment is also in favor of service companies, which supports margin expansion and strong earnings growth in the medium term." Wells Fargo reiterates BJ's and Costco as overweight Wells reiterated its overweight rating on shares of BJ's and Costco and says fuel is a "near-term tail wind as margins rise with prices." "Strong fuel earnings should be a material near-term earnings tail wind for staples retailers with this offering. Needham reiterates Coinbase as buy Needham said in a note that the stock is still attractive despite the volatility in crypto. "We remain bullish over our 12-mo time horizon and are excited about the opportunities in staking/blockchain services and COIN's newly launched NFT marketplace and showcase." Wells Fargo upgrades Rush Street Interactive to overweight from equal weight Wells said in its upgrade of the gaming company that it sees an attractive risk/reward. "Now, with shares down 63% YTD and sentiment vacillating between negative and apathetic, we believe RSI' s risk/reward skews favorably." JPMorgan downgrades JetBlue to underweight from overweight JPMorgan double downgraded the stock after its disappointing earnings report on Tuesday. "Given our significantly reduced 2023 earnings forecast, our JetBlue price target drops to $12, and reduces our earlier Overweight rating to Underweight." Read more about this call here. Piper Sandler downgrades Capital One to neutral from overweight Piper Sandler downgraded the financial-banking company due to expense inflation. "In hindsight, we should have made this move when COF abandoned their operating efficiency ratio target of 42% last quarter. This quarter, it has become apparent COF will have difficulty growing earnings over the next couple of years as operating expense inflation and rising credit costs weigh on earnings." Edward Jones upgrades Estee Lauder to buy from hold Edward Jones said in its upgrade of the stock that inflation concerns are overblown and that investors should buy the dip. "The stock is notably below its 52-week high largely due to concerns of inflation and higher interest rates slowing consumer spending. We believe these well-known concerns are causing investors to overlook Estee Lauder's many long-term and sustainable growth drivers." Goldman Sachs reiterates Microsoft as buy Goldman said in a note on Wednesday that it sees "sustained long-term growth" after the company's earnings report on Tuesday. "In our view, MSFT is likely to continue to gain share as the tech industry's relative contribution to global GDP grows 2x by the turn of the decade (per mgmt) and the company is well positioned across all three layers of the cloud stack." Bank of America downgrades Carter's to underperform from buy Bank of America double downgraded the children's clothing retail and says margins are at risk. "We are downgrading Carter's from Buy to Underperform as we see risk to margins from a more normalized promotional environment, think the success of price increases is dependent on peer behavior, and see 2023E margin downside from rising cotton prices." Benchmark reiterates Amazon as buy Benchmark said in a note on Wednesday it's concerned about negative sentiment going into Amazon earnings on Thursday. "Like several other high-profile names that report this week, we believe sentiment is already extremely negative and under the assumption that forward forecasts are too high, which, at least from a cost perspective, should already be known given the surprise 5% fuel and inflation surcharge announced a couple weeks ago." Bank of America reiterates Alphabet as buy Bank of America kept its buy rating on the internet giant after its earnings report on Tuesday and says investors should stick with the stock. "However, vs. peers, Alphabet has a more stable business, artificial intelligence (AI)/ machine learning (ML) advantages across the product stack (Performance Max a positive), significant expense flexibility, a mgmt team doing more for shareholders under new CEO (i.e. buybacks) and potential valuation support." Read more about this call here. CFRA upgrades General Motors to buy from hold CFRA upgraded the automaker after its better-than-expected earnings results on Tuesday. " GM' s results were much better than anticipated in light of its struggles with ongoing chip shortages and supply chain issues, and while its EV sales won't pick up materially until 2023 with the debut of its six Ultium models, we believe the stock's current valuation now justifies a Buy." UBS reiterates Chipotle as buy UBS said in a note to clients after its earnings report on Tuesday that the stock is "quality growth you can count on." " CMG results & commentary included 1Q sss upside and better than expected 2Q comp & margin guidance, more than offsetting a 1Q margin miss, and easing some investor concerns around traffic & margins."
The logo for McDonald's on a restaurant in Arlington, Virginia, January 27, 2022.
Joshua Roberts | Reuters
Here are the biggest calls on Wall Street on Wednesday: