Here are the top Wall Street calls for Monday. Morgan Stanley upgraded Tesla from equal to overweight. Morgan Stanley stated that Dojo, Tesla’s supercomputing project, was a key catalyst in their upgrade. Investors have debated for years whether Tesla is a tech or auto company. We think it’s both but the software and service revenue is what we see as being the most valuable. You can read more about this report here. JPMorgan upgraded Tenable from neutral to overweight JPMorgan stated that the security software solution company is “well-positioned for improved fundamentals.” “We see a good opportunity for growth, margin expansion and
in the second half of the year, into FY24, for TENB.” JPMorgan upgraded Nubank from neutral to overweight JPMorgan stated that it saw an attractive entry for the Brazilian Neobank company. We upgrade Nubank to OW because we are more confident in its winning secular strategy, and the recent share price correction is a good entry. Bank of America Upgrades CSX from Neutral to Buy Bank of America stated in its upgrade of railroad company it sees volume improvements. “While rail volumes are still down by mid-single digits for the 3Q to date, and have been negative for 30 weeks in a row, CSX’s trend is -3.4%, which is ahead of our -4.6% goal. JPMorgan downgrades Brunswick from overweight to neutral JPMorgan stated that higher interest rates would weigh on the marine recreational company in the months to come. Our research shows that higher interest rates will be the main factor in affecting new boat demand over the next year. Boat borrowing rates are at +9%, which is the highest rate since the mid-1990s. (60% historical correlation between BC retail unit growth and BC retail unit rates). Bank of America confirms Nvidia’s position as a top investment. The bank said that Nvidia shares are “compelling at their current levels.” NVDA’s reduced valuation reflects concerns from investors about the sustainability of genAI capital expenditure, as well as geopolitical risks and (overstated), competitive threats from AMD/INTC. NVDA’s dominance in high-cost training is a result of genAI deployments moving to lower-cost deployments. Barclays introduces Bluebird at overweight Barclays stated that the company has accelerated fundamentals in its initiation. “We initiate BLBD as Overweight due to high backlogs and strong public support for investment in school buses.” UBS reiterates Amazon’s buy UBS stated that it sees margin growth for the streaming giant. We think Amazon’s North America retail margins can grow to double-digits in the future (compared to the consensus of 5.4% for ’25), as it: 1) unveils efficiency initiatives like regionalizing its distribution network, and 2) pulls levers that will recoup inflation costs. Bank of America recommends Raymond James for purchase. The bank said that the financial services firm is well-positioned and has an attractive defensive portfolio. RJF is one of our most diversified business models, and it’s well positioned to deal with future macro-scenarios compared to many of its peers who are interest rate dependent. Click here to read more about this report. Evercore ISI confirms Netflix’s outperform Evercore stated that its latest survey checks showed Netflix has “competitive advantage” in international markets. Mexico’s “Core” trends are still strong. But we believe the real lesson here is that Netflix could enjoy greater competitive advantage in international markets because of relatively weaker home entertainment options. This would lead to higher satisfaction levels and lower churn rates. Redburn Atlantic repeats Disney as a sell Redburn stated that it sees too much negative catalysts for Disney. Disney faces more challenges than ever as it struggles to gain traction with its direct-to consumer business. If the carriage dispute between Charter and Disney is not resolved, this could result in a 18% reduction of OI [free cash flow]. Bob Iger, the CEO of Disney, faces many challenges. Linear advertising is also at a critical point. Deutsche Bank upgrade Kenvue from Hold to Buy. Deutsche says the shares of Johnson & Johnson’s spin-off are attractive. We are upgrading KVUE from Hold to Buy as we believe the stock is oversold. Although the fundamental uncertainties and legal liabilities risks (talc and acetaminophen), outlined in our initial report, are still valid, they have been more than adequately discounted by current valuation. This call is detailed here. Jefferies announces SharkNinja is a buy Jefferies stated that the product and design technology company has “high profit margins and an enormous total addressable market.” We believe SN’s global rapid innovation model and flywheel approach to commercialization will help it grow its market share in new and existing categories. Bernstein upgrades Brown-Forman from market perform to outperform Bernstein stated that it sees “a constructive margin outlook” for beverage maker. Brown-Forman’s exposure to growth has been improved by M & A: the company is now more premium, and exposed to categories and regions with high-growth. Citi adds positive catalyst watch to Microsoft Citi stated that it sees “rich catalyst paths” ahead for Microsoft’s shares. We are opening a positive catalyst watch for the next 90 days on MSFT, as we expect shares to trade higher through year-end with a rich path of catalysts ahead. Microsoft’s relative performance has been lagging after a strong YTD movement through June. Baird announces Block as its new pick Baird believes investors should take advantage of the current dip in the shares of the former Square. We understand the concerns of investors about the processing problem on Thursday, but we believe that the system is back up and working. And, at 3.5X revenue for 2024E, the stock is oversold. This call is described in detail here. Barclays affirms Apple as equal Weight Barclays is bullish going into Apple’s iPhone announcement on Tuesday but it stands by its equal-weight rating. We believe that the impact of price increases on Pro models will be key this year. As Pro model ASPs [operating income] are set to rise against a weaker macro background, we think that there will be a headwind to units. We’ll also be closely watching carrier incentives. “[average selling price]
