Wall Road's high analysts say they’re shopping for shares like Amazon and Yelp because the virus re-emerges
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On Wall Street, stocks are taking a breather from this month's rally. Despite encouraging updates on a potential coronavirus vaccine, disappointing unemployment data and a surge in coronavirus cases have scared investors.
New York Mayor Bill de Blasio announced that schools would return to distance learning to help mitigate the spread of the virus.
"The market has really been in a celebratory state since Election Day and it went through it again last week. I think the idea now is that people start taking profits before they expect the capital gains tax-related tax in the year Could rise in 2021. I. Also, think the transition from COVID to post-COVID is being considered … Despite the resurgence, all vaccine news tells us that post-COVID is imminent, "noted John Stoltzfus, Chief Investment Strategist at Oppenheimer.
With many question marks going into the future, it's not easy to spot stocks that can outperform the broader market. One approach is to target the analysts who are proven to be successful. TipRanks' forecasting service for analysts seeks to identify the top performing analysts on Wall Street. These are the analysts with the highest success rate and average return per rating.
Here are the five most popular stocks of analysts right now:
In response to the promising data on Pfizer and Moderna's coronavirus vaccines, investors have turned their backs on beneficiaries of the pandemic like Amazon. The five-star analyst Laura Martin remains optimistic about the e-commerce and computer giant. To this end, on November 18, it reiterated a Buy recommendation and a price target of USD 3,700 (19% upside potential).
Following the vaccine news, Martin conducted a survey to measure consumer shopping habits and upcoming plans. In a survey of around 330 consumers, 80% of those questioned said that they would make the same or several online purchases after the pandemic. "As AMZN is the leader in e-commerce, we see it as the biggest beneficiary of this trend," she commented.
When Martin asked if their shopping habits would change when a vaccine becomes available, about 69% said they would use Amazon the same way they did during the pandemic when Amazon's demand increased, while another 15% said they would use Amazon Internet shopping side would be even more.
With regards to the upcoming holiday season, the analyst wanted to find out when consumers would be doing their shopping. Of the respondents, 44% said that 50% to 100% of their holiday shopping had already been completed.
"In our view, Amazon's Prime Day moved forward to the shopping calendar in October. Given the first mover advantage, we expect AMZN to be the biggest beneficiary of spending that was postponed earlier in the calendar," said Martin.
With a success rate of 66% and an average return of 24.9% per rating, Martin ranks 67th on TipRanks' list of the top performing analysts.
The five-star analyst Matthew Hedberg from RBC Capital switched software development company Bentley Systems to buy from hold on November 15th. With a price target of 43 USD, the analyst sees an upside potential of 26%.
The upgrade follows an impressive first quarter performance as a public company. That, combined with a mid-October pullback, makes the risk / reward profile much more attractive, according to Hedberg, as stocks now trade "closer to peers and a discount to premium peers like Ansys and Autodesk".
For the quarter, Bentley posted sales and earnings per share of $ 203 million and $ 0.17, respectively, versus consensus estimates of $ 197.3 million and $ 0.13, respectively. Additionally, Adjusted EBITDA was $ 73.6 million, beating the Street's call of $ 56.5 million. Most notable for Hedberg, however, was the 9% ARR growth that outperformed his 8% projection.
Looking to the future, Bentley's forecast for fiscal year 20 was also above consensus.
Hedberg added, "Overall, we believe that a vaccine could benefit Bentley and a Biden presidency could boost US infrastructure spending. Overall, we like the opportunity to have a long-term, permanent winner."
Hedberg lands in the top 25 in the TipRanks ranking and has a success rate of 74% and an average return of 27.2% per review.
On November 17th, PDF Solutions announced the acquisition of Cimetrix, a software interface company for capital goods that enables data acquisition from manufacturing tools. For Gus Richard of Northland Capital, this deal reinforces his bullish thesis, with the analyst repeating a buy rating the following day. Along with the call, he continues to assign a target price of $ 30, suggesting upside potential of 43%.
Under the terms of the agreement, PDFS will pay $ 35 million in cash, net of cash on Cimetrix's balance sheet. The transaction is scheduled to close in the fourth quarter of 2020.
The move is part of PDF Solutions 'focus on accelerating efforts with equipment suppliers as Cimetrix provides a distribution channel for software development teams at equipment suppliers, using the Cimetrix data as "the feedstock for PDFS' Exensio big data analytics platform," Richard said . The PDF platform has permeated fabs, fabless and OSATs, but the equipment suppliers have limited exposure.
"Together, PDFS / Cimetrix can enable equipment suppliers to collect equipment operating data and use the PDFS big data analytics platform and AI to analyze equipment operating, performance and process control data. We believe working with PDFS / Cimetrix equipment supplier can improve process control, equipment uptime and lower MTBF. The acquisition brings Exensio closer to the de facto standard platform for big data analytics for the semiconductor industry and expands the company to electronic manufacturing services, EMS and making displays, "said Richard.
Based on analyst estimates, the acquisition could have a positive impact in FY21, increasing earnings by $ 0.02-0.04.
TipRanks shows that the analyst ranked 52nd has an impressive 72% success rate and an average return of 28.2% per rating.
Cytokinetics, a biopharmaceutical company developing muscle activators and muscle inhibitors as potential treatments for people with debilitating diseases that affect muscle performance, just got a thumbs up from H.C. Joseph Pantginis by Wainwright. In addition to maintaining a buy rating on Nov. 16, he maintained a target price of $ 43 on the stock, implying an upside of 180%.
Pantginis announces to customers that Omecamtiv Mecarbil, its selective cardiac myosin activator for the potential treatment of heart failure with reduced ejection fraction (HFrEF), "continues to show promise in a large pre-defined population".
In October, CYTK and partners Amgen and Servier said the therapy had met the primary composite efficacy endpoint of reducing CV death or RF events, but not the secondary endpoint of reducing CV death. However, last week, Cytokinetics presented the results of GALACTIC-HF, Omecamtiv's Phase 3 outcome study at AHA, which shows the drug has a potentially greater treatment effect in the pre-determined group of patients with more severe HF due to a left ventricular Ejection Fraction (LVEF).
It should be noted that omecamtiv's "fate" may depend on "Amgen's views on the drug along with a full analysis of the data and the results of a market research analysis focused on the views of doctors and payers" Pantginis. However, the analyst remains optimistic.
"Although more analysis needs to be done and more details are needed to clarify the real chances of omecamtiv in HF, we believe that these results define a possible avenue for approval of omecamtiv based on its applicability for treatment , suggest significant population. " "Declared Pantginis.
Pantginis ranks 169th out of 7,093 analysts recorded by TipRanks.
For RBC analyst Shweta Khajuria, Yelp is currently one of her top stock picks. In a bullish signal, the five-star analyst raised the target price from USD 29 to USD 34 (7% upside potential) and repeated a buy rating on November 18.
Khajuria tells customers that she has considered Yelp a "vaccine inventory" for several quarters. This is the most recent rally in the share price since the Pfizer vaccine announcement.
As the analyst explained, "While there is great uncertainty until the vaccine will actually be distributed on a large scale, we believe Yelp is well positioned to benefit from the rebound in the third quarter, based on ours, given improving fundamentals Belief that the snap-back in the restaurants and bars, beauty & fitness, health & shopping categories will be relatively quick with the opening of the economy. This is in addition to improving trends in Home & Local, driven by product improvements and worldly tailwind. "
In a post-coronavirus environment, Khajuria believes that Yelp could benefit from the improving macroeconomic environment if the economy opens up as ad spending correlates with GDP growth. Additionally, product changes that have been a focus for the company over the past year and a half should bode well for Yelp, according to the analyst.
"Management believes that Yelp will take greater advantage, both perceived and actual, from improving its value proposition to advertisers in order to preserve a larger share of the advertising budget," added Khajuria.
When it comes to go-to-market strategy, management believes that Yelp's sales force has declined 45% year over year, even after the coronavirus, which Khajuria says is positive.
Khajuria currently has an 89% success rate and an average return of 80.3% per review.