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Shoppers browse the aisles during a Black Friday sale at a Target store, Friday, Nov. 23, 2018, in Newport, Ky.
John Minchillo | AP
Here are the biggest calls on Wall Street on Thursday:
Goldman Sachs initiated Target, Walmart, Costco, Home Depot & Lowe’s as ‘buy’ & adds Target to the ‘conviction buy’ list
Goldman Sachs said that it looks for “outperforming comps and operating income growth” in its new coverage of retail stocks.
“In our view, operating income dollar growth, market share growth, and defensiveness are key criteria for the sector in light of the current macroeconomic backdrop. We note the big box retailers are best positioned based on these metrics over the next year…Recommend to Buy: TGT, BJ, COST, HD, LOW, EYE, ORLY, TSCO, WMT and WSM. “
Read more about this call here.
Wedbush upgraded Abercrombie & Fitch to ‘neutral’ from ‘underperform’
Wedbush upgraded the maker of casual wear mainly on valuation.
“With Abercrombie & Fitch Co’s valuation now reset, as shares currently trade at a 66% discount to the company’s 5-year historical PE and proprietary data inflects positively, we are upgrading our rating on shares to NEUTRAL, and issuing a POSITIVE data signal. “
J.P. Morgan upgraded Weight Watchers to ‘neutral’ from ‘underweight’
J.P. Morgan said in its upgrade note that the company’s subscriber trends have “stabilized.”
“We are upgrading shares of WW from underweight to neutral and raising our price target to $22 as we believe that subscriber trends have stabilized, which is supportive of the company’s ability to reach 2019 guidance. “
Jefferies downgraded Take-Two Interactive to ‘hold’ from ‘buy’
Jefferies said the game maker is in a “soft spot” due to the timing of the company’s next big release.
“Despite the undeniable success of Grand Theft Auto & RDR and the long-tail revenue contribution, we believe TTWO is now in a ‘soft spot’ when considering the timing of the next major release. “
Cowen initiated Microsoft as ‘outperform’
Cowen said in new coverage of the stock that Microsoft can deliver $100B of revenue by 2025.
“We believe MSFT has positioned itself in the right secular growth markets to deliver an incremental $100BN of revenue by FY25, driving consistent double digit earnings growth in FY20-FY25. We expect MSFT’s Commercial Cloud, including both Office 365 Commercial and Azure, to be the primary driver of growth going forward. “
Citi downgraded International Paper to ‘neutral’ from ‘buy’
Citi said in its downgrade that it prefers packagers over paper companies and that it sees further “price erosion” for IP.
“However prices for most of IP‘s major Pulp & Paper products are falling, and we think the risk of further price erosion & negative earnings revisions may limit share price upside into year-end. Accordingly, with our updated estimates our target price moves to $45 and we move to Neutral. “
Bank of America raised its price target on Snap to $17 from $12
Bank of America said Snap is seeing “improving” user trends.
“We raise our PO to $17 based on a higher 10x 2020e EV/Sales to reflect improving user trends and higher growth expectations.”
Read more about this call here.
Bank of America downgraded Comerica to ‘underperform’ from ‘buy’
Bank of America said downgraded the regional bank and said shares will “lag” as the Fed cuts rates.
“The thesis is simple: CMA is the most short-rate sensitive stock in our universe, and we believe shares will continue to lag peers as the Fed cuts rates. Rising rates, as opposed to balance sheet growth, drove 97% of CMA’s net interest income growth since the Fed began tightening in 3Q15. “
Credit Suisse downgraded Allstate to ‘underperform’ from ‘neutral’
Credit Suisse said the insurer’s margins are under pressure due to weather and competition.
“Record levels of precipitation combined with heightened price competition within personal lines insurance mean core home/auto margins are under more pressure…Insurers most levered to homeowners’ insurance are Allstate, which we are downgrading to Underperform, followed by TRV, CINF, HIG and CB. “
