My top 10 things to watch Tuesday, Jan. 16 1. Bank earnings and disappointment over nothing. They were all pretty good. Before the bell, Goldman Sachs beat revenue estimates on better-than-expected asset management results, while Club holding Morgan Stanley reported fourth-quarter sales of $12.90 billion, beating Wall Street expectations of $12.75 billion thanks to strength in investment banking . We will send out a full earnings analysis later today following management’s call with analysts. 2. This could be a big year for health care, a business that can actually grow faster than most of tech and has the possibility of a comeback from the Covid straitjacket that so many of these companies got caught up in. In my Sunday column , I ran through 4 great stock ideas from the JPMorgan Healthcare Conference last week. 3. Abbott Labs is a healthcare stock which had its growth obscured by the pandemic. Wells Fargo raised its price target to $131 from $121 and kept its overweight rating. The firm said Abbott’s 2024 base business growth could accelerate over its pre-pandemic rate of 7%. 4. Microsoft price target raised to $435 from $425 at Wells Fargo. The firm said the Club name has much more AI-related products in the pipeline. 5. DuPont double downgraded to sell from buy at Bank of America. The firms sees only a modest earnings recovery in 2024 and “under-appreciated” PFAS liabilities. We made a small sale of DuPont shares a week ago. We still like our longer-term investment thesis centered on the recovery in the semiconductor and electronics industry, but trimmed just in case the timeline gets pushed out another quarter due to the slower bounce back in China. 6. Starbucks upgraded to buy from hold at Morgan Stanley, which cited an “interesting risk-reward skew.” The firm also said China concerns are now fully priced into the shares. Big call because the Club stock has been horrendous. 7. Piper Sandler joins the crowd with an upgrade of Home Depot to buy from hold. Total group think which will work. The firm cited more large remodel projects expected in 2024. It also raised its price target for Lowe’s to $245 from $218. Separately, Bernstein raised targets for both Lowe’s and Home Depot. 8. Baird downgraded RTX and Northrop Grumman to hold from buy. The analyst expects mixed Q4 results for most defense stocks — surprising given how strong the sector has been. 9. RBC Capital backs UnitedHealth despite big hit to profits. These firms have misjudged the consumer and surgeries. 10. KLA Corp price target raised to $500 from $425 at Barclays. All capital equipment stocks are too low because the cycle is starting. Firm also raised Lam Research target to $750 from $600. Sign up for my Top 10 Morning Thoughts on the Market email newsletter for free (See here for a full list of the stocks at Jim Cramer’s Charitable Trust.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
Shannon Stapleton | Reuters
My top 10 things to watch Tuesday, Jan. 16
1. Bank earnings and disappointment over nothing. They were all pretty good. Before the bell, Goldman Sachs beat revenue estimates on better-than-expected asset management results, while Club holding Morgan Stanley reported fourth-quarter sales of $12.90 billion, beating Wall Street expectations of $12.75 billion thanks to strength in investment banking. We will send out a full earnings analysis later today following management’s call with analysts.
2. This could be a big year for health care, a business that can actually grow faster than most of tech and has the possibility of a comeback from the Covid straitjacket that so many of these companies got caught up in. In my Sunday column, I ran through 4 great stock ideas from the JPMorgan Healthcare Conference last week.
3.Abbott Labs is a healthcare stock which had its growth obscured by the pandemic. Wells Fargo raised its price target to $131 from $121 and kept its overweight rating. The firm said Abbott’s 2024 base business growth could accelerate over its pre-pandemic rate of 7%.
4.Microsoft price target raised to $435 from $425 at Wells Fargo. The firm said the Club name has much more AI-related products in the pipeline.
5.DuPont double downgraded to sell from buy at Bank of America. The firms sees only a modest earnings recovery in 2024 and “under-appreciated” PFAS liabilities. We made a small sale of DuPont shares a week ago. We still like our longer-term investment thesis centered on the recovery in the semiconductor and electronics industry, but trimmed just in case the timeline gets pushed out another quarter due to the slower bounce back in China.
6.Starbucks upgraded to buy from hold at Morgan Stanley, which cited an “interesting risk-reward skew.” The firm also said China concerns are now fully priced into the shares. Big call because the Club stock has been horrendous.
7. Piper Sandler joins the crowd with an upgrade of Home Depot to buy from hold. Total group think which will work. The firm cited more large remodel projects expected in 2024. It also raised its price target for Lowe’s to $245 from $218. Separately, Bernstein raised targets for both Lowe’s and Home Depot.
8. Baird downgraded RTX and Northrop Grumman to hold from buy. The analyst expects mixed Q4 results for most defense stocks — surprising given how strong the sector has been.
9. RBC Capital backs UnitedHealth despite big hit to profits. These firms have misjudged the consumer and surgeries.
10.KLA Corp price target raised to $500 from $425 at Barclays. All capital equipment stocks are too low because the cycle is starting. Firm also raised Lam Research target to $750 from $600.
Sign up for my Top 10 Morning Thoughts on the Market email newsletter for free
(See here for a full list of the stocks at Jim Cramer’s Charitable Trust.)
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As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade.
THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY, TOGETHER WITH OUR DISCLAIMER. NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
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