Here are Thursday’s biggest calls on Wall Street: Goldman Sachs downgrades Advance Auto Parts to neutral from buy Goldman downgraded the stock after its disappointing earnings report Wednesday. “We are downgrading AAP to Neutral from Buy due to concerns regarding near-term execution and share loss in the company’s DIFM (do-it-for-me)business, ongoing margin erosion, and, in our view, the lack of a clear near-term catalyst to drive a multiple re-rating.” Read more about this call here. Barclays upgrades bluebird bio to overweight from equal weight Barclays said in its upgrade of the biotech company that it sees several positive clinical trials coming to fruition for bluebird. ” BLUE proposed a payment structure with one upfront payment that could be paired with an outcomes-based agreement. Depending on the treatment outcome, BLUE would repay the payors up to 80% of the price if a patient failed to achieve and maintain transfusion independence up to 2 yrs following infusion.” Barclays downgrades Johnson Controls to equal weight from overweight Barclays said it’s concerned about “fading margin drivers.” “The issue is that we think most non-residential buildings trends (esp. the US and Europe) are peaking or are already decelerating. As this slowdown gathers steam into 2024, we think this will make it harder for JCI to ‘work’ as a stock.” Goldman Sachs reiterates Salesforce as buy Goldman said it’s standing by its buy rating on the stock after its earnings report Wednesday. “Generative AI can serve as an accelerant with Salesforce well positioned to innovate and capitalize on this categorical spend given its unique data-set and broad enterprise reach.” RBC upgrades Chevron to outperform from sector perform RBC said the oil and gas giant is well-positioned. “Looking forward, we believe the macro environment is likely to remain volatile, however weaker end product demand and OPEC+ managing the oil market leaves CVX’ s upstream heavy weighting well-placed.” Read more about this call here. JPMorgan downgrades Okta to neutral from overweight JPMorgan Chase said it sees too many macroeconomic pressures for the company. ” OKTA remains an identity market leader, but macro is putting incremental pressure on growth.” JPMorgan downgrades Target to neutral from overweight JPMorgan Chase said in its downgrade of the stock it sees a “weakening” consumer. “As we’ve discussed at length, we continue to believe that the consumer is broadly weakening while the share of wallet shift away from goods (51% of TGT sales) is ongoing.(2) Additionally, as we’ve also been vocal about disinflation in grocery (~40% of sales ex beauty and including essentials) continuing to accelerate, eating into the ballast of TGTs recent slightly positive to negative LSD(low single digits) SSS trend.” Read more about this call here. Deutsche Bank initiates Toll Brothers, D.R. Horton and PulteGroup as buy Deutsche Bank initiated several homebuilders such as Toll Brothers , D.R. Horton and PulteGroup on Wednesday night and says the stocks will go higher as fundamentals improve. “But with continued improvement in demand fundamentals and book valuations fairly attractive by historical standards, our view is that homebuilder stocks can climb meaningfully higher.” Bank of America initiates Toast as buy Bank of America said the restaurant tech company is “best in class.” “Our checks at last week’s National Restaurant Association (NRA) conference illustrated that TOST delivers best-in-class, cloud-native, point-of-sale (POS) software/hardware technology to the restaurant industry.” Deutsche Bank adds a catalyst call buy on BorgWarner Deutsche Bank said the automotive supplier is one of the “best EV stories.” “BorgWarner intends to spin its aftermarket and fuel systems segments into a standalone company called PHINIA, which could deliver stable low DD margins and strong FCF generation…” Citi reiterates Meta and Alphabet as top picks Citi said Meta and Alphabet are “best positioned to benefit given product-led innovation, expanding ad budgets, & the secular mix shift to digital advertising.” “Our top online advertising picks are META, GOOGL, CRTO, and TTD which we believe are best positioned to benefit given product-led innovation, expanding ad budgets, & the secular mix shift to digital advertising.” Morgan Stanley reiterates Tesla as overweight Morgan Stanley said Tesla is well-positioned to “navigate the geopolitical and economic challenges.” “Within our coverage, we see Tesla as best positioned to navigate the geopolitical and economic challenges inherent in re-wiring the EV battery supply chain.” RBC downgrades ExxonMobil to sector perform from outperform RBC downgraded the stock mainly on valuation and a more balanced risk/reward. ” XOM has outperformed most global peers over the last year, supported by strong refining margins and improving perception on the duration of its free cash flow profile.” Cowen upgrades Phillips 66 to outperform from market perform Cowen said it sees “refining operational improvement” for the energy company. “We anticipate PSX refining ops returning to pre-Covid, top-tier performance as it refocuses energies toward that segment.” Wedbush upgrades C3.ai to outperform from neutral Wedbush said the artificial intelligence company is “laying the groundwork for the next stage of AI growth.” “While it will be a bumpy road, we believe c3 has turned a corner and is ready to now capitalize on the $800 billion AI transformational opportunity over the next decade with use cases increasing across the board and the company in a unique position to help lead the charge and monetize this looking ahead the next 12 to 18 months.” JPMorgan upgrades Domino’s Pizza to overweight from neutral JPMorgan Chase said in its upgrade of Domino’s that it’s too cheap to ignore. “We downgraded the stock previously on July 23, 2021 as we saw pressure in retaining the essential delivery driver staff matched with pressure on new store returns likely leading to lower store development. This call has played out and a fresh look at estimates shows the stock as too cheap for what is a structurally low cost delivery at $6.99 for a medium 2-topping and take-out provider for a $7.99 3-topping large pizza.” UBS upgrades CSX to buy from hold UBS said in its upgrade of the railroad company it sees an “attractive entry point.” “With rail stocks typically bottoming several months before volumes bottom and CSX trading at only 15x on our 2024E EPS, we believe now is an attractive entry point ahead of a potential volume inflection in 2024.” Macquarie initiates Madison Square Garden Entertainment as outperform Macquarie said its bullish on the New York entertainment company. “This season saw both the Knicks and Rangers make the playoffs, driving ecosystem value both for MSGS and MSGE , along with potential underpinning of ad demand on the Networks despite continued steep sub declines.” Bank of America reiterates Dick’s as buy Bank of America said it’s bullish on the company’s new store format. “Overall, we were impressed with DKS’ new store format which is expected to drive a majority of its future square footage growth going forward and believe DKS is seeing strong momentum across its three current locations.”
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