Brokers: Jefferies and Morgan Stanley pick their post-Brexit stocks

The two banking giants have picked the stocks they think will emerge unscathed from the Brexit fire

google's headquarters in Silicon Valley California
Silicon Valley firms like Alphabet Inc should prosper in the post-Brexit world, says Morgan Stanley

The UK’s decision to leave the European Union last week sent global markets into meltdown, as investors, uncertain as to what the consequences of Brexit might be, pulled their money out of equities.

The sell-off was indiscriminate, even stocks with seemingly little or no exposure to Europe took massive hits.

Nearly a week on, as investors begin to pick through the rubble of the crumbled stock market, Morgan Stanley and Jefferies International have picked some stocks they expect to prosper in this post-Brexit world.

“We believe the post-vote weakness created an opportunity to add positions,” Morgan Stanley said in a research note.

Based on its picks, the financial services giant isn’t concerned for the health of Silicon Valley firms. Here are its top five picks, based on market valuation:

1.       Apple Inc (NASDAQ:AAPL)

2.       Alphabet Inc (NASDAQ:GOOGL)

3.       Amazon.com, Inc (NASDAQ:AMZN)

4.       Facebook, Inc (NASDAQ:FB)

5.       IBM (NYSE:IBM)


Earlier in the week, Jefferies International revealed its top picks that have the highest implied 12 month upside.

The investment bank said it believes that “volatility may persist at high levels for a while” yet, but expects that a number of stocks “should benefit from company-specific positives whatever happens in Europe.”

Here are Jefferies’ top ten picks for the coming year:

1.       Abercrombie & Fitch Co (NYSE:ANF)

2.       Mimecast Ltd (NASDAQ:MIME)

3.       OneMain Holdings Inc (NYSE:OMF)

4.       NXP Semiconductors NV (NASDAQ:NXPI)

5.       Harsco Corporation (NYSE:HSC)

6.       Acadia Healthcare Company Inc (NASDAQ:ACHC)

7.       Spirit AeroSystems Holdings, Inc (NYSE:SPR)

8.       Synchrony Financial (NYSE:SYF)

9.       Freeport-McMoRan (NYSE:FCX)

10.   Tiffany & Co (NYSE:TIF)


Today's key upgrades and downgrades

In other broker news today, NIKE Inc (NYSE:NKE) took a beating from the banks and brokers, with many slashing their price targets for the stock.

The sportswear giant had its price target cut to US$65 from US$67 by Jefferies, Citigroup slashed its target for the stock to US$61 from US$75, while Macquarie also trimmed its price target for the sportswear giant to US$75 from US$77.50.

The cuts didn’t stop there either, Canaccord Genuity lowered its price for Nike to US$56 from US$57, while Stifel Nicholas trimmed its target price to US$68 from US$73.

Elsewhere, Goldman Sachs upgraded Casey’s General Stores Inc (NASDAQ:CASY) to a ‘buy’ recommendation from ‘neutral.

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