Here are Tuesday’s biggest calls on Wall Street: Benchmark downgrades Netflix to sell from hold Benchmark said in its downgrade of the stock that it’s “skeptical” of a sustained a Netflix recovery. “We have made mild estimate revisions off continued U.S. dollar strength, including vs. the yen and European currencies, that is likely not fully reflected in prior 2Q22 guidance or analyst consensus. We are skeptical on any sustained Netflix stock recovery even as bulls are (or were) talking up its 14.1x forward P/E off 2023 consensus estimates.” Bank of America downgrades Best Buy to neutral from buy Bank of America said Best Buy’s valuation is less attractive. “We downgrade consumer electronics retailer Best Buy to Neutral from Buy, as increasing uncertainty around 2023 earnings makes valuation look incrementally less attractive.” Read more about this call here . JPMorgan reiterates Robinhood as underweight JPMorgan lowered its price target on the stock trading company to $7 per share from $11 and said it sees a “weaker trading volume outlook.” “We maintain our Underweight rating as the market continues continue to deteriorate for Robinhood as regulatory risks rise.” Deutsche Bank reiterates Apple as buy Deutsche trimmed its price target on shares of the tech giant to $175 per share from $200 mainly on valuation. “From a stock perspective, AAPL’ s year-to-date stock performance has been in line with or better than most mega-cap tech peers; however, considering the macro uncertainties influencing investor sentiment, we believe it’s unlikely that AAPL’s valuation will return to the 5-year high of more than ~30x in the next 12 months.” JPMorgan reiterates Amazon as a best idea JPMorgan said in a note Tuesday that it sees Amazon making more e-commerce penetration gains. ” Amazon’s share of US e-comm increased to 40% in 2021; AMZN remains the fastest growing scaled US retailer.” Credit Suisse initiates Chesapeake Energy as buy Credit Suisse said in its initiation of the energy company that it’s emerging from restructuring stronger and with a compelling valuation. ” CHK emerged from restructuring with a substantially stronger balance sheet and lower cost structure, unburdening it from the primary issues that saddled the legacy company.” Read more about this call here. Bank of America reiterates Kroger as a top pick Bank of America said it’s bullish heading into Kroger earnings later this week and that market share trends are getting better. “We expect broad-based inflation to increasingly drive consumers to retailers offering variety (good, better & best options) & value (incl. higher-margin private label). We also think KR’s fuel rewards/loyalty program will help drive traffic & offset smaller basket sizes as customers react to high inflation.” BMO initiates Marathon Petroleum as outperform BMO said in its initiation of the petroleum refinery company that it’s a market leader on buybacks and it sees more upside in the stock. “Following the $21Bn sale of its Speedway business, Marathon has led the energy sector on capital return. With record refining margins and improved operational execution, we believe Marathon can continue to lead peers on buybacks, and see upside to its base dividend.” Deutsche Bank downgrades Hewlett Packard Enterprise to hold from buy Deutsche Bank downgraded the information technology due to a more cautious IT spending outlook. “…and we downgrade HPE to Hold as we expect the stock to trade sideways on cautious IT spending.” Read more about this call here. UBS downgrades AstraZeneca to neutral from buy UBS downgraded the pharmaceutical company due to a lack of any upcoming positive catalyst. “However, it is now in more sensible territory and at our price target and as there are no major catalysts on our radar until 1Q23, we downgrade our rating to Neutral. In times of reduced pipeline noise, the market tends to focus more on AZN’ s margin progression and we suspect this time it will be no different with some additional debate around the trajectory in China.” JPMorgan downgrades Coinbase to neutral from overweight JPMorgan downgraded the crypto company due the slide in crypto prices. “While we continue to be believers in the cryptocurrency markets and blockchain technology, the extreme decline in the price of cryptocurrency markets in 2Q22 combined with Coinbase’ s ramp in investment would appear to not only make it challenging for it to generate a profit in the near future but also to meet its annual loss cap of $500mn of annual EBITDA.” Read more about this call here. UBS initiates Jazz Pharmaceuticals as buy UBS said in its initiation of the pharmaceutical company that it has “strong product diversification.” “We believe JAZZ has multiple offense/ defense strategies to soften the competitive blow.” Citi upgrades Nokia to buy from neutral Citi said in its upgrade of the telecommunications that it sees improving fundamentals particularly in the U.S. market. “The mobile infrastructure market is showing strong momentum, particularly so in Nokia’ s key U.S. market, and Nokia’s decade-long share losses have ceased and are showing signs of improvement.” Cowen naming IAC/InterActiveCorp as a best idea Cowen named the owner of brands like Angi as a top idea and says the stock is undervalued. ” IAC is our best Smidcap idea for 2022, as IAC’s portfolio businesses trade at a significant conglomerate discount, in our view.” JPMorgan reiterates Apple as overweight JPMorgan said that it’s bullish on Apple TV+ ramping up subscribers over time. “Over time as the content library grows, we forecast subscriber count to ramp up to ~90 mn by 2025, bringing in ~$4.8 bn of revenue.” JPMorgan reiterates Apple as overweight JPMorgan said that Apple ‘s Fitness+ is on track to deliver $3.6 billion in revenue by 2025. “Apple’s Fitness+ subscription service launched in December 2020 is tightly integrated in its ecosystem and priced competitively relative to other subscriptions leveraged by consumers, but more importantly, Apple’s content addresses a wider demographic relative to competitors targeting a much narrower demographic with specific fitness programs.” Morgan Stanley reiterates Tesla as overweight Morgan Stanley said investors should stick with the stock after reports surfaced that Elon Musk warned of a tough quarter in an email to employees. “But as Tesla has shown throughout its history, it can make up substantial lost ground with accelerated deliveries into the close of a quarter where disproportionate amounts of a full quarter’s production can occur in the final week or two. Additionally, what may be lost in 2Q could just provide pent-up sequential tailwinds for 3Q results.”
