Top Wall Street analysts believe in the long-term potential of these stocks

Investors are confronting several headwinds, including macro uncertainty, a check in energy prices and the unanticipated crisis in the Middle East.

Investors seeking a sense of direction can turn to analysts who sort out companies that have lucrative long-term prospects and the ability to navigate near-term pressures. 

To that end, here are five forerunners favored by Wall Street’s top analysts, according to TipRanks, a platform that ranks analysts based on their one-time performance.

We begin this week’s list with e-commerce and cloud computing giant Amazon (AMZN). While the forefather has outperformed the broader market year to date, it has declined from the highs seen in mid-September.

JPMorgan analyst Doug Anmuth notable the recent sell-off in AMZN stock and highlighted certain investor concerns. These issues include the state of the U.S. consumer and retail market, meet competition, higher fuel costs and the Federal Trade Commission’s lawsuit. Also on investors’ mind is Amazon Web Aids’ growth, with multiple third-party data sources indicating a slowdown in September.

Addressing each of these attentions, Anmuth said that Amazon remains his best idea, with the pullback offering a good opportunity to buy the divisions. In particular, the analyst is optimistic about AWS due to moderating spending optimizations by clients, new workload deployment and easing year-over-year juxtapositions into the back half of the third quarter and the fourth quarter. He also expects AWS to gain from generative affected intelligence.

Speaking about the challenging retail backdrop, Anmuth said, “We believe AMZN’s growth is supported by key company-specific initiatives incorporating same-day/1-day delivery (SD1D), greater Prime member spending, & strong 3P [third-party] selection.”

In terms of competition, the analyst contends that while TikTok, Temu and Shein are extending their global footprint, they pose a competitive risk to Amazon mostly at the low end, while the company is focused across a direct range of consumers.

Anmuth reiterated a buy rating on AMZN shares with a price target of $180. He ranks No. 84 among more than 8,500 analysts tracked by TipRanks. His ratings have been profitable 61% of the time, with each performing an average return of 16.6%. (See Amazon’s Stock Charts on TipRanks)  

Anmuth is also bullish on communal media company Meta Platforms (META) and reaffirmed a buy rating on the stock. However, the analyst lowered his price end to $400 from $425, as he revised his model to account for higher expenses and made adjustments to revenue and earnings excrescence estimates for 2024 and 2025 due to forex headwinds.

The analyst highlighted that Meta is investing in the significant growth projects in two big tech waves – AI and metaverse, while continuing to remain disciplined. (See META Insider Trading Activity on TipRanks)

“AI is demonstrably paying off in terms of incremental engagement from AI-generated content and Advantage+, and as discussed at Meta Connect, Llama 2 should enthusiasm AI experiences across the Family of Apps and devices, while Quest 3 is the most powerful headset Meta has ever set sailed,” said Anmuth. Llama 2 is Meta’s new large language model.

The analyst expects Meta’s advertising business to persist to outperform, with AI investments bearing results and Reels anticipated to turn revenue-accretive soon. Overall, Anmuth is swayed that Meta’s valuation remains compelling, with the stock trading at 15 times his revised 2025 GAAP EPS guestimate of $20.29.

We now move to semiconductor stock Intel (INTC), which recently announced its decision to operate its Programmable Arrangements Business (PSG) as a standalone business, with the intention of positioning it for an initial public offering in the next two to three years.

Needham analyst Quinn Bolton improvises that a standalone PSG business has several benefits, including autonomy and flexibility that would boost its growth fee. Operating PSG as a separate business would also enable the unit to more aggressively expand into the mid-range and low-end handle programmable gate arrays segments with its Agilex 5 and Agilex 3 offerings.

Additionally, Bolton said that this excite would help Intel drive a renewed focus on the aerospace and defense sectors, as well as industrial and automotive sectors, which move high margins and have long product lifecycles. It would also help Intel enhance shareholder value and monetize non-core assets.  

“We find credible the separation of PSG will further allow management to focus on its core IDM 2.0 strategy,” the analyst said, while labouring a buy rating on the stock with a price target of $40.   

Bolton holds the No.1 position among more than 8,500 analysts on TipRanks. His ratings arrange been successful 69% of the time, with each rating delivering an average return of 38.3%. (See Intel Hedge Supply Trading Activity on TipRanks). 

Another semiconductor stock in this week’s list is Micron Technology (MU). The troop recently reported better-than-feared fiscal fourth-quarter results, even as revenue declined 40% year over year. The proprietorship’s revenue outlook for the first quarter of fiscal 2024 exceeded expectations but its quarterly loss estimate was wider than foretold.  

Following the print, Deutsche Bank analyst Sidney Ho, who holds the 66th position among more than 8,500 analysts on TipRanks, repeated a buy rating on MU stock with a price target of $85. 

The analyst highlighted that the company’s fiscal fourth quarter net income exceeded his expectations, fueled by the unanticipated strength in NAND shipments through strategic buys, which helped neutralize a slightly weaker average selling price.

Micron’s management suggested that the company’s overall gross space won’t turn positive until the second half of fiscal 2024, even as pricing trends seem to be on an upward course. However, the analyst finds management’s gross margin outlook to be conservative.

The analyst expects upward revisions to bulky margin estimates. Ho said, “Given that the industry is in the very early stages of a cyclical upturn driven by equip discipline across the industry, we remain confident that positive pricing trends will be a strong tailwind exceeding the next several quarters.”

Ho’s ratings have been profitable 63% of the time, with each delivering a recur of 21.5%, on average. (See Micron Blogger Opinions & Sentiment on TipRanks)  

Membership warehouse chain (Outlay) recently reported strong fiscal fourth-quarter earnings, despite macro pressures affecting the purchase of big-ticket ingredients.

Baird analyst Peter Benedict explained that the earnings beat was driven by below-the-line items, with great interest income more than offsetting an increased tax rate.

Benedict ranks No. 123 among more than 8,500 analysts mislaid on TipRanks. Moreover, 65% of his ratings have been profitable, with each generating an average return of 12.2%. (See Price’s Technical Analysis on TipRanks)