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What has Wall Street been buzzing about this week? Here are the top 5 buy calls and the top 5 sell calls made by Wall Street's best analysts during the trading week of June 10-14, 2024. First, here are the top 5 buy calls of the week.

1. DA Davidson Upgrades Apple after Seeing AI Features Driving iPhone Sales

DA Davidson upgraded Apple (AAPL) to Buy from Neutral with a price target of $230, up from $200. The firm believes the artificial intelligence capabilities Apple unveiled at the Worldwide Developers Conference will lead to an iPhone upgrade cycle.

The integration of summarization, enhanced search, multi-modality, text generation, and enhanced photo editing into the exiting ecosystem "will drive much broader adoption of AI than we have seen to date," DA Davidson tells investors in a research note.

Apple is also the first to introduce a meaningful agent capability that will allow Siri to execute tasks on behalf of the user, the firm points out. Davidson says Apple is "uniquely positioned to offer these capabilities, and may be the only one capable of doing so any time soon."

2. Walmart Upgraded to Overweight at JPMorgan

JPMorgan upgraded Walmart (WMT) to Overweight from Neutral with a price target of $81, up from $66. The firm believes the stock "adds a strong balance of defense and offense" in a softening consumer backdrop with a "highly uncertain" second half of 2024 ahead.

Consensus estimates remain beatable, while there is the potential for an uptick in the multiple as Walmart goes on a multi-year double-digit earnings growth algorithm from market share gains, rising alternative profit pool benefits, and International segment profit inflection, JPMorgan tells investors in a research note.

3. AMD Initiated With a Buy at Edward Jones

Edward Jones initiated coverage of AMD (AMD) with a Buy rating, while adding shares to the firm's Stock Focus List. The firm believes the company should deliver outsized growth as growing demand for data-center infrastructure should help drive accelerating sales of AMD's chips, in particular graphics processing units, or GPUs, and central processing units, or CPUs.

In addition, Edward Jones believes the company remains in the early innings of cross-selling and integrating Xilinx and AMD products.

4. Shopify Initiated With an Overweight at JPMorgan

JPMorgan initiated coverage of Shopify (SHOP) with an Overweight rating and a $74 price target. Shopify is a leading e-commerce enablement and infrastructure platform powering over 2 million online merchants across 175 countries, the firm tells investors in a research note.

JPMorgan believes the company's product breadth, ease of use, and scale are "distinct competitive advantages that will continue to fuel industry-leading growth." It models 18% compounded revenue growth through 2026 as Shopify benefits from the secular shift toward e-commerce and scales growth initiatives. The firm thinks the recent pullback creates an attractive entry opportunity for new investors.

Additionally, on Friday, Evercore ISI upgraded Shopify to Outperform from In Line with a $75 price target. The recent pullback in the stock has created an attractive entry point to own a "best-in-class" e-commerce platform business, the analyst told investors.

The firm sees a "very resilient long thesis" to Shopify shares, citing the company's "very large" total addressable market, "very strong" competitive position and up-market opportunity, "clear track record" of successful product innovation, and the potential for materially ramping profitability.

5. Chipotle Initiated With a Buy at Goldman Sachs

Goldman Sachs initiated coverage of Chipotle (CMG) with a Buy rating and a $3,730 price target. The firm started coverage of the restaurant sector with a "selectively constructive" view. Goldman is less worried about a pullback in the restaurant spending, given a "still-healthy "spending outlook and more lasting behavior shifts post-COVID.

However, strong pricing tailwinds are beginning to fade and value competition is stepping up as we come out of the post-pandemic inflation surge, the firm tells investors in a research note.

Goldman says this means that traffic and unit growth will become an increasingly important part of the restaurants' growth equation. It recommends focusing on concepts that could drive healthy traffic growth with unique brand proposition and differentiated offerings, or concepts with a path for accelerated unit growth.

Goldman's top idea is Chipotle Mexican Grill; its most "out of consensus Buy" is Starbucks (SBUX); and its best small-cap ideas are Sweetgreen (SG) and Shake Shack (SHAK). The firm's Sell ideas are Jack in the Box (JACK) and Wendy's (WEN), saying scale increasingly matters in a tougher competitive environment and that it sees multiple challenges for both in view of lower income consumer uncertainties and intensifying value competition.

Goldman sees a balanced risk/reward for Neutral-rated McDonald's (MCD) given near-term risks from its national $5 value menu launch.

Next, here are the top 5 sell calls of the week.

1. Paramount Downgraded to Underweight at Wells Fargo

Wells Fargo downgraded Paramount (PARA) to Underweight from Equal Weight with a price target of $9, down from $14. With the Skydance deal off, removing the potential for 50% of shares to be tendered at $15/share, and no potential M&A beyond an NAI sale, the stock is back to being valued on fundamentals, the firm tells investors in a research note.

The best opportunities for Paramount are meaningful asset sales such as BET and largely shutting down to Paramount+ to licensing quality content externally, Wells added.

2. Exane Says Comcast at "Tipping Point," Downgrades to Underperform

Exane BNP Paribas downgraded Comcast (CMCSA) to Underperform from Neutral with a $34 price target. The firm believes the end of the Affordable Connectivity Program will bring an increasingly volatile period across the U.S. telecommunications and cable space.

Comcast was "on the precipice," and the end of ACP will "tip them over the edge," Exane tells investors in a research note. The firm says that while Comcast thus far has shown resilience relative to peers amid an "onslaught" from fixed wireless access and fiber competitors, the "tipping point" is here.

3. Wendy's Initiated With a Sell at Goldman Sachs

Goldman Sachs initiated coverage of Wendy's (WEN) with a Sell rating and a $16 price target. The firm started coverage of the restaurant sector with a "selectively constructive" view. Goldman is less worried about a pullback in the restaurant spending given a "still-healthy "spending outlook and more lasting behavior shifts post-COVID.

However, strong pricing tailwinds are beginning to fade, the firm tells investors in a research note. Goldman says this means that traffic and unit growth will become an increasingly important part of the restaurants' growth equation.

4. Barclays Downgrades NextEra Energy Partners to Underweight on Limited Options

Barclays downgraded NextEra Energy Partners (NEP) to Underweight from Equal Weight with a price target of $25, down from $32.

With limited debt capacity should the company want to stay within its credit ratings, and an "extremely high" payout ratio of 95%, NextEra has limited potential options outside a distribution cut, with a reduction of at least 45% necessary, to pay off its remaining convertible equity portfolio financings, the firm tells investors in a research note.

5. TD Cowen Sees 20% Downside in Delek US, Downgrades to Sell

TD Cowen downgraded Delek US (DK) to Sell from Hold with a price target of $20, down from $25, which implies 20% downside from recent levels. Delek's parent may generate limited free cash flow at mid-cycle cracks, which is apparent from its recent results and guidance, the firm tells investors in a research note.

TD Cowen says Delek has widened its strategic reorganization opportunity set to options "less core to the goal," which may suggest issues executing on the better options. The company could benefit from an improved capital structure, though it has not pursued one to date, adds TD. The firm's base case does not incorporate any strategic reorganization given an uncertain timeline.

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