Here are Friday’s biggest calls on Wall Street: Mizuho launches WeWork as a buy buy Mizuho said WeWork is an undervalued game in ever-changing work preferences. “It is well positioned to capture a share of the flexible office market, which is poised to grow by 50% (US$50 billion) in the next three years, as office tenants rethink footprints and rental forms.” Bank of America is repeating Amazon’s where Bank of America said in a note Friday that it expects some gas cost pressures to hamper Amazon’s earnings, but it remains very constructive on the stock. “Inflation overshadows the 2022 margin recovery story, but AMZN remains our top FANG stock, with 2-hour e-commerce acceleration, margin improvement from a very low base ($70 billion in 2023 profit potential from 3P, AWS and advertising), and institutional exposure (Corporate Capital Expenditures) Cycle (Major Differentiation). UBS cut Union Pacific’s rating to neutral from a UBS buy and said capacity issues could affect the stock. “We are downgrading UNP from Buy to Neutral because we expect existing capacity limitations and service issues to affect volume performance, and these issues further reduce our conviction of UNP’s ability to implement its volume growth strategy.” JPMorgan upgrades United to overweight from underweight and an American to neutral from underweight JP Morgan said in its promotions of the United and American index that it has “escalated up” on airline shares. “Airline stocks have rebounded up to 60% from recent fuel panic lows made when demand trends were massively misunderstood. But gains to date are within 20%, and the sector is still holding 20% below its 2021 highs. But Aside from fuels and geopolitical pressures, almost every underlying input is stronger than last year (supply, demand, Covid, you name it).” Read more about this call here. Bernstein launched Take-Two and Electronic Arts in which Bernstein outperformed and initially said to video game companies that they see potential for growth. “We have expanded our video game coverage to include two US industry disciplines, Electronic Arts and Take-Two Interactive. We view the $180 billion video game industry as the best opportunity for structural growth in the media space, and rate both stocks as outperforming. .” Piper Sandler reiterated Microsoft as the overweight Piper said in a note to clients on Friday that it is cautiously optimistic about a trend toward earnings next week. “Microsoft’s model robustness should be on full display next week, in part insulated with a cloud mix shift that expanded to 48% of sales (versus 42% a year ago and 36% in F2020).” Citi has upgraded Dow to buy from neutral Citi and said in its update to the chemical company that it sees “strong execution amid higher energy prices.” “Dow posted solid first-quarter profit in a rapidly expanding, war-fueled environment in Europe, but the company overcame challenges with solid pricing.” Read more about this call here. Bank of America reiterated Apple with the Bank of America buyout announcement that it sees some near-term risks heading to Apple’s earnings next Thursday, but it stands by the tech giant’s shares. “However, we continue to view Apple as a long-term winner and believe the stock has more room to drive higher as we see significant catalysts including the opportunity to monetize better from its proven base, ad-related revenue growth, and opportunity in augmented/virtual reality. and long-term growth in services.” Deutsche Bank cuts JetBlue’s rating to hold it buy-back, and Deutsche said it sees limited upside at the moment for the airline. “We are downgrading HA and JBLU stock from buy to hold. The main reason for downgrading both names is that each carrier faces certain headwinds that are likely to limit the stock’s appreciation.” Read more about this call here. JP Morgan repeats Coca-Cola as overweight bank JP Morgan said in a note before Monday’s earnings that the beverage maker is its “biggest defensive holding”. “Given KO’s strong brand value and its products benefiting from low price flexibility, the stock should continue to serve as a high-quality defensive name with the upside to reopening on an uncertain macro background. It is attractive in this environment.” JPMorgan reiterated PepsiCo as overweight JPMorgan said in a note that it sees the top line “come in good shape” when the beverage company reports its earnings on Tuesday. “We believe PepsiCo has a product mix poised to deliver solid organic growth in earnings and a track record of consistently exceeding street expectations over the past few years, which compares favorably with its large-cap consumer goods peers.” Argus is upgrading the US company to buy from Argus, which said in its stock update that it sees a commercial and international recovery. “We are raising our rating on American Airlines Group Inc. to a purchase from HOLD. Over the next 12 months, we expect the company to benefit from accelerated business and international travel, as well as from management’s efforts to reduce costs.” JPMorgan reinstated Callaway Golf coverage as overweight JPMorgan reinstated the golf company and says Callaway has a “diversified revenue base.” “Overweight as a name for growth in golf with an accelerating multi-year financial profile including approximately 10% revenue growth which translates to +EBITDA growth for youth through our work with SOTP indicating Equity value of $30.” Bank of America reiterated CVS as Buy Bank of America said in its earnings preview note to CVS that it sees an upward trend in earnings in early May. “Even with the stock’s strong performance in 2021, we still see room for an upward rally and therefore reiterate our buy rating and $121.” Snap heavyweight Morgan Stanley reiterated in a note to clients after the social media company’s earnings Thursday that it sees some uncertainty about the stock, but Snap’s execution remains “robust.” “The prudent aggregate SNAP evidence sets the table for increasing uncertainty over the state of ad markets, while SNAP’s micro-implementation (on ads and interaction) remains strong.” Argus reiterates Tesla’s Argus purchase said in a note on Friday that Tesla is the “undisputed” leader in electric vehicles and that its earnings report earlier this week was “impressive.” “In our opinion, the results were impressive, as revenue, profit and gross margins continued to rise.”
A construction worker walks through a job site at Metropolitan Park, phase one of new construction for the Amazon HQ2 development project, Arlington, Virginia, October 13, 2021.
Kevin Lamarck | Reuters
Here are Friday’s biggest calls on Wall Street: