Dara Khosrowshahi, CEO, Uber
Carlo Allegri | Reuters
Here are the biggest calls on Wall Street on Tuesday:
Deutsche Bank initiated Uber as ‘buy’
Deutsche Bank called the ride-hailing service the most attractive Internet IPO since Facebook.
“We see Uber as the most attractive Internet IPO since Facebook and believe that concerns related to Uber’s profitability outlook pose less risk than Facebook’s tran-sition to mobile at that time. We see signs of rationalization in the competitive dynamics in ridesharing. This, combined with the lackluster IPOs of Uber and Lyft, which may curb irrational private funding activity, are likely to result in improving competitive dynamics and contribution margins for Uber. “
Read more about this call and other Uber initiations here.
Loop Capital upgraded Netflix to ‘buy’ from ‘hold’
Loop said Netflix has an “unstoppable lead” in subscription video streaming.
“We are upgrading NFLX to Buy and raising our price target to $425 as we add senior Internet analyst Rob Sanderson to the research coverage team. This addition is in conjunction with today’s coverage introduction of Internet stocks including each of the US-based “FANG” and China-based “BAT” stocks. We continue to think that NFLX has built an unstoppable lead in subscription video streaming and the margin opportunity is expanding as it increasingly becomes content producer, distributor and retailer. We are raising our view of 2025 earnings power from about $28 previously to $32 currently.”
Read more about this call here.
Cowen lowered its price target on Apple to $220 from $245
Cowen said the Department of Justice jurisdiction announcement could be an “overhang.”
“We came away upbeat that innovation remains strong at Apple as we believe the company remains in a transitional period of unifying its 3 major hardware platforms while focused on future Services and Subscription content growth. Project Catalyst was a key announcement. The DoJ’s newly announced jurisdiction for possible future probes could be an overhang for the stock. “
Canaccord Genuity lowered its price target on Apple to $202 from $245
Canaccord lowered its price target on Apple on China trade uncertainty among other things.
“Due to ongoing China trade uncertainty, our expectations for muted iPhone upgrade sales ahead of 5G iPhones expected in September 2020, and belief the shares will trade at a lower multiple during this period of slower earnings growth, we have reduced our estimates and price target multiple, resulting in us lowering our price target from $245 to $202. Given ongoing trade tensions between China and the Unites States, we believe Chinese consumers could slow Apple hardware purchases, leading us to trim our estimates.”
Loop Capital raised its price target on Amazon to $2,380 from $2,200
Loop said Amazon’s market cap could triple over the next four to five years.
“We are reiterating our Buy rating on Amazon, introducing a new valuation methodology, and increasing our price target to $2,380 from $2,200 as we add senior Internet analyst Rob Sanderson to the research coverage team. This is in conjunction with today’s broader Internet coverage introduction, including each of the US-based “FANG” and China-based “BAT” stocks. There is no change to our positive view on Amazon, which is the simultaneous leader of two of the largest secular growth opportunities available to investors today. Our new price target is based on our view of Amazon’s 2025 earnings power discounted back to the present. Despite a valuation that already places Amazon among the world’s most valuable companies, our view of Amaon’s earnings power suggests the company’s market cap could still triple over the next four to five years.”
BMO upgraded Take-Two Interactive to ‘market perform’ from ‘underperform’
BMO said it thinks video game stocks can be a “safe haven” for investors with a possible economic downturn.
“We are upgrading shares of Take-Two to Market Perform from Underperform. With the threat of an economic downturn we believe video game stocks will be increasingly seen as safe havens for investors. Thus, we anticipate the elevation of valuation multiples for these stocks. TTWO has a robust pipeline and remains a perceived target for acquisition, which could also keep its current multiple elevated. Though we still have concerns about fundamental performance, we are increasing our target price and moving to the sidelines. “
Citi initiated Lyft as ‘buy’
Citi said Lyft is “well positioned” in a “volatile industry.”
“Readers of Citi’s past Car of the Future body of work know that we have long-viewed the network effect as the most coveted asset in the entire mobility race, in what will likely prove to be a few regional- winners-take-all outcome. We’re sitting in the early-innings of a transition that we believe is likely to upend the current personal mobility value-chain—resulting in lucrative addressable markets (of various forms) for the network winners. We view Lyft to be well-positioned to participate in this LT upside proposition, and we like the company’s concentrated focus (U.S./Canada, rides) and net cash position in what can be a volatile industry. “