Here are Monday's the biggest calls on Wall Street: Morgan Stanley reiterates Apple as overweight Morgan Stanley said it sees further gross margin expansion for Apple . "We see multiple tail winds to drive a rerating over the next 12 months including 1) continued adoption of 5G smartphones, 2) PC market share gains on the back of new and differentiated Apple silicon-driven Macs." Argus reiterates McDonald's as buy Argus kept its buy rating on shares of McDonald's , saying it likes the company's post-pandemic and turnaround prospects. "We expect McDonald's, with its strong digital, delivery, and drive-thru businesses, to endure a period of soft industry sales better than most other restaurant chains. During the current period of industry weakness, we prefer large restaurant chains like McDonald's that offer value menus, spend heavily on advertising and have clean balance sheets." Wells Fargo reiterates AbbVie as overweight Wells Fargo listed several reasons to buy shares of the biopharmaceutical stock, including "multiple pipeline catalysts" ahead. "After the recent weakness in ABBV, we revisited the model and we came away even more confident regarding the growth prospects and pipeline." Read more about this call here. BMO downgrades Weyerhaeuser to market perform from outperform BMO downgraded the paper company mainly on valuation. "With WY trading at a ~15% premium to our NAV (net asset value), we are stepping to the sidelines. Shares could trade higher with strong lumber/panel markets and rising ESG interest." Cowen upgrades Bath & Body Works to outperform from market perform Cowen said in its upgrade of Bath & Body Works that it likes the company's "product innovation, customer retention and efficient marketing spend." "Valuation is attractive at ~10x FY2 P/E, which is a significant discount to beauty peers, and we see room for multiple expansion." Read more about this call here . Bank of America initiates Johnson Controls as buy Bank of America said in its initiation note of the fire- and HVAC-equipment company that it sees a "self-help" story and "visibility at a discount." "We note that JCI has the highest relative nonresidential construction exposure among its HVAC peers. We are bullish on the outlook for the U.S. nonresidential cycle." Read more about this call here. Piper Sandler downgrades KeyCorp to underweight from neutral and upgrades Comerica to overweight from neutral Piper said in its upgrade of Comerica that it's doing an "about-face" on the stock due to the bank's "emerging shift toward rate neutrality from heavy asset sensitivity." The firm also downgraded KeyCorp due to macro uncertainty. "We are upgrading CMA from Neutral to Overweight. We feel like this is a bit of an about-face from how we thought about the name immediately following earnings. ... We are taking our rating on KEY from Neutral to Underweight. ... But among the large regionals covered by this analyst, our sense is that the uncertainty around the degree of fee recovery that may be required to meet expectations could limit the stock, especially within the context of a macro-environment that seems only to be getting more uncertain." Citi removes UPS from the focus list Citi reiterated its buy rating on UPS but removed the stock from its focus list due to a lack of near-term catalysts. "In addition, given UPS' s solid results, which are underpinned by sustainable pricing and execution, the weakness in shares reflects a near-trough multiple on a negative case outcome for 2023 EPS. This presents favorable risk/reward. Nevertheless, while we remain Buy rated, we are removing UPS from the Focus List given fewer near-term catalysts." Bank of America reiterates Uber as buy Bank of America said ahead of the company's earnings release that the "mobility recovery continues" for Uber. "We remain constructive on Uber as we think valuation reflects ongoing uncertainty on driver supply and take rates, and we still expect a strong travel/mobility recovery this summer." Cowen reiterates Chevron as outperform Cowen said the oil and gas giant is well positioned after its earnings report last week. " CVX cash generation appeared better than first blush. The company increased Permian guidance though kept capex flat. There continues to be M & A focus despite recent deals given cash position and valuation." Morgan Stanley reiterates Exxon as overweight Morgan Stanley said in a note that the the oil and gas giant remains "uniquely positioned" after its earnings report last week. " XOM' s large downstream footprint makes it an outsized beneficiary of strong refining margins relative to peers." UBS reiterates Yum Brands as buy UBS said that the owner of Taco Bell and Kentucky Fried Chicken was a "quality, defensive compounder on sale." "We believe YUM should be among the sector's most resilient in a recessionary environment and/or a prolonged period of elevated inflation." Morgan Stanley reiterates Wells Fargo as a top pick Morgan Stanley said in a recap note on bank earnings that Wells Fargo is a "strong position to monetize higher rates." "Wells is the most rate-sensitive stock in our coverage, with a 50bp increase in front-end rates driving up annual EPS ~14%, triple peers. WFC is also in a strong position to monetize higher rates, as cash stands at 13% of earning assets, roughly double pre-pandemic levels."
Tim Cook at the Apple launch event, March 8, 2022
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