Morgan Stanley has upgraded a raft of stocks to overweight — here are 5
Despite the market volatility, Morgan Stanley upgraded a raft of stocks in March, including both U.S. and global picks. The bullish calls spanned tech, pharmaceuticals and more, with the bank giving one stock a double upgrade. Here are five of the stocks upgraded by the investment bank: Pinduoduo Morgan Stanley upgraded Chinese e-commerce giant Pinduoduo to an overweight rating in a Mar. 2 note, raising its price target to $113 — giving the stock 52% upside to its current level. It said the company, which is also listed in the U.S., benefits from the long-term consumption trend, and is a “structural” growth stock in Chinese e-commerce. The recent share price correction presents a good entry point into Pinduoduo, the Morgan Stanley analysts said. While there were several reasons for the drop, such as a weaker-than-expected consumption recovery and rising geopolitical tensions, the bank believes the market might have overestimated the impact on the firm. Furthermore, Morgan Stanley said Pinduoduo’s user base has enlarged “significantly,” and user stickiness has strengthened. “PDD is still the go-to e-commerce platform for most consumers who have cultivated their price-conscious shopping behavior over the past three years during Covid, and it will continue to support its long-term growth,” the bank’s analysts wrote. ACM Research Morgan Stanley gave California-based ACM Research, which provides cleaning services for semiconductor equipment, a double upgrade from an underweight rating to overweight. It also gave the stock a price target of $13.50, or 20% potential upside, in its note from Mar. 6. The bank said ACM should enjoy a strong year of growth in 2023, supported by “strong” market share gains and new product launches. It also expects business in Europe in power semiconductors to expand. Morgan Stanley added that the company’s price power was “holding up quite well” and raised its 2023-2024 earnings-per-share estimates. Meta Morgan Stanley upgraded the stock from equal weight to overweight , and raised its price target to $250 – implying upside of 21%. “We are positive on META’s structural pivot toward increased efficiency and (importantly) improving revenue, engagement and Reels trends,” the bank’s analysts wrote in a March 21 note. They added that Meta is better positioned than Google, which hasn’t reduced costs as aggressively, and Amazon, where rising retail profitability is dependent on growing consumer spend. Harley-Davidson The bank upgraded Harley-Davidson to overweight , giving it a price target of 50%, or nearly 40% upside. A pullback in the firm’s shares to under $40 has made it “too inexpensive” given its 3% topline growth and 12% free cash flow yield, according to Morgan Stanley in a Mar. 21 note. Sarepta Therapeutics Morgan Stanley upgraded Sarepta Therapeutics to overweight with a price target of $187, giving the stock potential upside of 43%. Morgan Stanley thinks that one of Sarepta Therapeutics ‘ drugs will receive accelerated approval from the Food and Drug Administration — creating a promising investing opportunity — according to a Mar. 1 note. — CNBC’s Michael Bloom contributed to this report.
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