Wall Street’s top analysts are betting on stocks like Qualcomm & Humana

While it’s now seemly clear Joe Biden will take the White House, investors are betting that Congress will be split, do a moonlight flit President Trump’s corporate tax policy unchanged.

“Up until about last week, the consensus belief was a full pornographic sweep — now that’s changing you’re seeing a repricing taking place in the market… a more status quo Senate may mitigate the burden of regulations on the tech sector,” Anna Han, an equity strategist at Wells Fargo Securities, commented.

That clouted, as many factors remain uncertain, finding stocks primed to outperform the broader market isn’t easy.

One approach is to look at the modern stock picks from analysts that consistently get it right. TipRanks analyst forecasting service attempts to diagnose Wall Street’s best-performing analysts, or the analysts with the highest success rate and average return per rating, railed on a one-year basis.

Here are the best-performing analysts’ five favorite stocks right now:

On November 2, biotech party Provention Bio revealed the rolling submission of the BLA for teplizumab, a therapy that could potentially delay or prevent clinical standard 1 diabetes (T1D) in at-risk patients, had been completed. For Chardan analyst Gbola Amusa, this development reaffirms his self-assurance in PRVB, with the company remaining a “Top Pick for 2020.” To this end, he reiterated a Buy rating and $35 price target (169% upside covert) after the news broke.

The FDA has 60 days to review the final submission, and after this, if the application is acceptable for assess, a PDUFA goal date will be set. It should be noted that the drug was granted Breakthrough Therapy Designation (BTD) in 2019, trim the review time from 10 months to 6 months.

“We see scope for Provention to meet its prior guidance of a potential U.S. green light allow of teplizumab for the delay or prevention of T1D in at-risk individuals in mid-2021… Teplizumab is a potential breakthrough asset, with much significant results in subjects ‘at-risk’ for end-stage T1D,” Amusa commented.

Looking at the Phase 2 “at-risk” study, drawn though it’s smaller in size, the data represents the “first demonstration of therapeutic modulation of disease progression in T1D, strongly strengthening Provention’s approach to treating autoimmune disease in the early stages,” in Amusa’s opinion. In addition, the therapy was praised in an leading article published in the New England Journal of Medicine.

What’s more, Amusa estimates the at-risk population is a blockbuster opportunity equitable in the U.S. Based on information from the JDRF T1 Fund, there are over 300,000 stage 1-2 T1D patients in the U.S. and 2.3 million worldwide. “300,000 U.S. patients at a $60,000 one-time sacrifice for a course of treatment implies a $18 billion total market opportunity. A 60,000 per year transitioning population for each dais implies a $2.4 billion per year recurring total market opportunity,” he explained.

Taking the #99 spot on TipRanks’ series, Amusa is currently tracking a 31.8% average return per rating.

Fabrinet has just received a thumbs up from Needham’s Alex Henderson, with this five-star analyst tender an $85 price target (29% upside potential) and a buy rating on the stock on November 3.

In the most recent quarter, the optical communications emblem company handily beat Henderson’s revenue and EPS estimates by 4.4% and 7%, respectively, and posted year-over-year growth of 9.4% and 22.9%, individually. All of this was achieved despite an uncertain backdrop, with pressure on Huawei and Service Provider spending also reproduced. Putting it simply, Henderson said, “These are good results.”

Henderson argues that investors have been waiting to see Huawei’s collision fall out of its numbers, and now that the “fourth quarter bridge has been crossed, the upside is all that remains.”

Cisco is effective a large portion of Systems products to Fabrinet, which could exceed $250 million annually, according to Henderson. Howsoever, he points out that the reported numbers only reflect a minor contribution from the Cisco transition, but this should unquestionably ramp in CYQ1 2021 and reach full run rate by June, with the first full quarter run rate expected in September.

The analyst depth mentioned, “We think the scale of this additional business is generally not reflected in the outlook and Street estimates… It should add at small $50-$60 million to Revenues year-over-year. The Street estimates have CYQ3 Revenues at $454 million up $18 million. We assume the Fabrinet without Cisco could hit this number. If the rest of FN was flat it would do $486-$496 million. That’s a lot of upside.”

TipRanks lay bares that the #153-rated analyst scores a 57% success rate and a 20.4% average return per rating.

Since CFO John Collins secured on board, business messaging and communications software company LivePerson has placed a significant focus on implementing a data-driven propositions across all aspects of the business, giving five-star analyst Ryan MacDonald, of Needham, “increased confidence in the improving track of the business.”

Taking an even more bullish stance, on October 30, MacDonald increased the price target from $60 to $65, in as well to reiterating a Buy rating. The new price target puts the upside potential at 5%.

Based on the results from its third quarter, MacDonald denotes the data-driven approach appears to be working. The company delivered a “Rule of 40 with a combination of 26% revenue spread and 18% free cash flow margin.” This marked LPSN’s first quarter of positive free gelt flow since Q4 2018, with it highlighting “the progress the company is making on expense optimization while producing self-willed top line growth,” in the analyst’s opinion.

“LPSN is adamant that the pandemic-driven increases in usage are sustainable and indicative of a structural schedule in the market… When combining this with the operational efficiencies that the company is implementing across the system, we remain confident that LPSN can continue to accelerate growth and expand margins,” MacDonald commented.

Some investors verbalized concern that new logos have yet to rebound. However, MacDonald believes there is a “strong near-term expansion break in the existing base can support growth acceleration while new reps and channel partners ramp.” As a result, he is a buyer at in touch levels.

Given MacDonald’s 81% success rate and 40.4% average return per rating, he is among TipRanks’ Top 45 best-performing analysts.

On November 4, Deutsche Bank’s Ross Seymore sustained a buy rating on Qualcomm following a beat and raise quarter for the semiconductor company. Reflecting an additional bullish signal, the five-star analyst supported the stock price forecast from $127 to $150, implying upside potential of 16%.

Shares of Humana