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Here are the biggest calls on Wall Street on Monday:
Goldman Sachs upgraded Micron to ‘buy’ from ‘neutral’
Goldman said it thinks that the excess memory chip inventory will be depleted faster than previously expected and that memory chip pricing could start to improve during the third quarter.
“We believe that Micron is the best stock to express our view, and we upgrade MU to Buy from Neutral. Investing in Micron at this stage of the cycle (DRAM contract prices are still falling) carries significant risks, in particular with the large amounts of inventory at the memory companies (as this can impact both cost structure and pricing). “
Read more about this call here.
Goldman Sachs downgraded Marvell Technology to ‘neutral from ‘buy’
Goldman downgraded the semiconductor company mainly on valuation.
“Since being added to the Buy list on 9/18/2018, MRVL shares are up 41% vs. the SOX up 12% and the S&P 500 up 3%. The move upward in the stock has been driven entirely by multiple expansion (we believe this is mostly because Marvell has announced 5G design wins that should start to ramp in 4QCY19). The implied P/E multiple on NTM Street (FactSet) EPS was up 114% while we were Buy-rated on the stock. “
Stifel upgraded Stitch Fix to ‘buy’ from ‘hold’
Stifel upgraded Stitch Fix and cited an attractive entry price for the styling service’s shares.
“The stock has sold off ~16% since the beginning of July (versus the S&P 500 +1%), and shares are now trading at ~1.3x CY:20 sales, which we believe offers an attractive entry point. Despite the slowdown in active client growth, we are confident in management’s ability to drive healthy ARPU growth in the intermediate term by continuing to improve keep rates through stronger personalization (Style Shuffle), high-quality client adds, and healthy retention.”
Deutsche Bank raised its price target on Amazon to $2,515 from $2,315
Deutsche Bank said Amazon was in a “sweet spot” of “slightly” accelerating revenue from “continued efficiency improvements.”
“Given our view that Amazon is running in a sweet spot of revenue acceleration and still slight margin expansion and multiple expansion on the software side, which we flow to our AWS multiple, we increase our TP to $2,515 and reiterate our Buy rating on shares.”
KeyBanc raised its price target on Amazon to $2,200 from $2,100
KeyBanc upgraded its price target on Amazon after the company’s biggest Prime Day in its history.
“Amazon’s Fifth Annual Prime Day was the biggest in company history– bigger than Black Friday and Cyber Monday combined – and largely avoided the technical difficulties of last year. The event lasted 12 hours longer this year, fueling the record sales. Similar to last year, Whole Foods offered a $10 Amazon Prime Day credit if a Prime Member spends $10 at Whole Foods in-store or on Prime Now. We believe that trends have improved since the 1Q and our higher estimates for U.S. retail underpin our increase in price target to $2,200.”
Morgan Stanley raised its price target on Apple to $247 from $231
Morgan Stanley raised its price target on Apple and said it was a “top pick” into year end and an “attractive” setup into earnings.
“Investor sentiment remains negative despite improving iPhone and Services data points, with low expectations for Sept. quarter suggesting a positive setup into earnings. We see multiple catalysts beyond earnings that make Apple a top pick into year end.”
Read more about this call here.
Atlantic Equities initiated Intel as ‘underweight’
Atlantic Equities said that the CPU market had reached an inflection point and that Intel had a “deteriorating” outlook.
“We believe that the CPU market has reached an inflection point, with AMD’s latest line-up of CPUs now capable of competing against Intel on an equal footing for the first time in over a decade. We anticipate that AMD will continue to gain market share over the next three years and see no structural impediment to it regaining the equal share it commanded when last competitive against Intel. While this shift is already reflected in AMD’s share price, transitory tailwinds have allowed the market to overlook Intel’s deteriorating outlook. “
UBS upgraded Hershey to ‘neutral’ from ‘sell’
UBS said in its upgrade of Hershey that it likes the pricing power and consolidation in U.S. confection.
“Two tenets of our cautious thesis have changed… First, consolidation in US confection has driven better category stewardship as privately owned competitors Ferrero and Mars have elevated the chocolate industry’s profit pool by enhancing ingredients and packaging rather than competing on promotions. Second, US confection pricing power is stronger than we initially assessed. Last week Mars announced ~10% price increases for front-of-store confection.”
Roth Capital downgraded Tesla to ‘neutral’ from ‘buy’
Roth Capital downgraded Tesla and said it saw intensifying competition and rising battery costs.
“Downgrading Tesla to Neutral from Buy, as we see risk-reward as well balanced at current levels. We believe investors now give credibility to probable demand upside out of China, and Tesla has a viable path for meeting at least the low end of the 360-400k 2019 deliveries guide. “
RBC downgraded Qualcomm to ‘sector perform’ from ‘outperform’
RBC downgraded Qualcomm and said it couldn’t recommend the stock until the FTC ruling was complete and the outlook became clearer.
“While we think Qualcomm has a number of high quality assets and a healthy product portfolio, until the current FTC ruling is complete we have a difficult time recommending an Outperform or Underperform rating. Until we receive clarity on the official ruling, we rate QCOM Sector Perform, as the outcome is unclear. “
