EBay Inc. signage is demonstrated at the entrance to the company’s headquarters in San Jose, Calif.
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Is the market tackle up for a pullback? A correction for stocks could be on the horizon, says strategists from Bank of America, but this isn’t necessarily a bad apparatus.
“We expect a buyable 5-10% Q1 correction as the big ‘unknowns’ coincide with exuberant positioning, record equity supply, and ‘as creditable as it gets’ earnings revisions,” the team of Bank of America strategists commented.
Meanwhile, Jefferies’ Desh Peramunetilleke imitates this sentiment, writing in a recent research note that while stocks aren’t due for a “prolonged unwinding,” investors should use advantage of any weakness if the market does experience a pullback.
With this in mind, how are investors supposed to pinpoint compelling investment possibilities? By paying close attention to the activity of analysts that consistently get it right. TipRanks analyst forecasting service take a crack ats to identify the best-performing analysts on Wall Street, or the pros with the highest success rate and average return per assessing.
Here are the best-performing analysts’ top stock picks right now:
Shares of networking solutions provider Cisco Arrangements have experienced some weakness after the company released its fiscal Q2 2021 results. That said, Oppenheimer analyst Ittai Kidron’s bullish premiss remains very much intact. To this end, the five-star analyst reiterated a Buy rating and $50 price target.
Area of expertise Wall Street’s expectations “muted”, Kidron tells investors that the print featured more positives than voidings. First and foremost, the security segment was up 9.9% year-over-year, with the cloud security business notching double-digit expansion. Additionally, order trends improved quarter-over-quarter “across every region and customer segment, pointing to gradually decaying COVID-19 headwinds.”
That being said, Cisco’s revenue guidance for fiscal Q3 2021 missed the mark as a result ofs to supply chain issues, “lumpy” cloud revenue and negative enterprise orders. Despite these obstacles, Kidron stay puts optimistic about the long-term growth narrative.
“While the angle of recovery is difficult to pinpoint, we remain positive, take in the headwinds as temporary and considering Cisco’s software/subscription traction, strong BS, robust capital allocation program, cost-cutting initiatives, and compelling valuation,” Kidron commented
The analyst summed, “We would take advantage of any pullbacks to add to positions.”
With a 78% success rate and 44.7% average return per proportion rank, Kidron is ranked #17 on TipRanks’ list of best-performing analysts.
Highlighting Lyft as the top performer in his coverage territory, Wells Fargo analyst Brian Fitzgerald argues that the “setup for further gains is constructive.” In line with his sanguine stance, the analyst bumped up his price target from $56 to $70 and reiterated a Buy rating.
Following the ride part company’s Q4 2020 earnings call, Fitzgerald believes the narrative is centered around the idea that the stock is “down-to-earth to own.” Looking specifically at the management team, who are shareholders themselves, they are “owner-friendly, focusing intently on shareholder value inception, free cash flow/share, and cost discipline,” in the analyst’s opinion.
Notably, profitability could come in Q3 2021, a chambers earlier than previously expected. “Management reiterated EBITDA profitability by Q4, also suggesting Q3 as a possibility if volumes meter toe (and lever) ’20 cost cutting initiatives,” Fitzgerald noted.
The analyst added, “For these reasons, we expect LYFT to allurement to both fundamentals- and momentum-driven investors making the Q4 2020 results call a catalyst for the stock.”
That being hinted, Fitzgerald does have some concerns going forward. Citing Lyft’s “foray into B2B delivery,” he undertakes it as a potential “distraction” and as being “timed poorly with respect to declining demand as the economy reopens.” What’s more, the analyst conceive ofs the $10-$20 million investment in acquiring drivers to meet the growing demand as a “slight negative.”
However, the positives overcome the negatives for Fitzgerald. “The stock has momentum and looks well positioned for a post-COVID economic recovery in CY21. LYFT is somewhat cheap, in our view, with an EV at ~5x FY21 Consensus revenues, and looks positioned to accelerate revenues the fastest among On-Demand inventories because it is the only pure play TaaS company,” he explained.
As Fitzgerald boasts an 83% success rate and 46.5% customary return per rating, the analyst is the 6th best-performing analyst on the Street.
For top Roth Capital analyst Darren Aftahi, Carparts.com is a top pick for 2021. As such, he put a Buy rating on the stock, in addition to lifting the price target from $18 to $25.
Recently, the auto parts and accessories retailer revealed that its Immense Prairie, Texas distribution center (DC), which came online in Q4, has shipped more than 100,000 packages. This is up from clumsily 10,000 at the beginning of November.
According to Aftahi, the facilities expand the company’s capacity by around 30%, with it sight an increase in hiring in order to meet demand, “which could bode well for FY21 results.” What’s more, manipulation stated that the DC will be used for traditional gas-powered car parts as well as hybrid and electric vehicle supplies. This is effective as this space “could present itself as a new growth category.”
“We believe commentary around early demand in the moddest DC…could point to the trajectory of DC being ahead of schedule and having a more meaningful impact on the P&L earlier than look for. We believe getting sales fully turned on still remains the next step in getting the DC fully operational, but entire, the ramp in hiring and fulfillment leave us optimistic around the potential upside impact to our forecasts,” Aftahi commented.
Additionally, Aftahi accepts the next wave of government stimulus checks could reflect a “positive demand shock in FY21, amid tougher comps.”
Delightful all of this into consideration, the fact that Carparts.com trades at a significant discount to its peers makes the analyst all the more more positive.
Achieving a whopping 69.9% average return per rating, Aftahi is ranked #32 out of over 7,000 analysts railed by TipRanks.
Telling clients to “take a looksee over here,” Stifel analyst Scott Devitt a moment ago gave Fidelity National Information
Fidelity National Information serves the financial services industry, offering technology results, processing services as well as information-based services. As RBC Capital’s Daniel Perlin sees a possible recovery on tap for 2H21, he is the outback to his Buy rating and $168 price target.
After the company published its numbers for the fourth quarter, Perlin told patrons the results, along with its forward-looking guidance, put a spotlight on the “near-term pressures being felt from the pandemic, specifically noted FIS’ lower yielding merchant mix in the current environment.” That said, he argues this trend is poised to reverse as daring comps are lapped and the economy further reopens.
It should be noted that the company’s merchant mix “can create confusion and variability, which remained conspicuous heading into the print,” in Perlin’s opinion.
Expounding on this, the analyst stated, “Specifically, key verticals with powerful growth during the pandemic (representing ~65% of total FY20 volume) tend to come with lower revenue cedes, while verticals with significant COVID headwinds (35% of volumes) generate higher revenue yields. It’s for this excuse that H2/21 should setup for a rebound, as many of the discretionary categories return to growth (helped by easier comps) and non-discretionary areas could remain elevated.”
Additionally, management noted that its backlog grew 8% organically and generated $3.5 billion in new sales in 2020. “We find creditable that a combination of Banking’s revenue backlog conversion, pipeline strength & ability to drive product innovation, diagrams a path for Banking to accelerate rev growth in 2021,” Perlin said.
Among the top 50 analysts on TipRanks’ list, Perlin has achieved an 80% good rate and 31.9% average return per rating.