Investors struggled through with white knuckles last week as the major moving averages fluctuated wildly, fueled by key inflation reports.
On Thursday, the Dow Jones Industrial Average jumped 1,500 points from its low for the day to its high for the day. The major averages reversed on Friday, with all three indices ending losses.
To pick the right stocks to weather this turmoil, investors need to think well beyond daily volatility and delve into the details to find the long-term winners.
Here are five stocks picked by Wall Street’s top pros, according to TipRanks, a platform that ranks analysts based on their past performance.
Parent Facebook Metaplatforms (META) was plagued by challenges. These include lower ad revenue, increased technology costs, increased borrowing costs and chip shortages. Nonetheless, the focus on the Metaverse keeps analysts hooked on the stock.
At its recent Meta Connect conference, the company announced several major VR innovations and professional integration partnerships. The conference caught the attention of experts, many of whom believe the number of Metaverse users has not yet reached a significant number. (See Meta Platforms Stock Chart & Stock Technical Analysis on TipRanks)
Speculations notwithstanding, Monness Crespi Hardt analyst Brian White remains bullish. He believes that Meta is “the clear leader in VR.” White recalled an IDC report revealing that Meta had captured 90% of the global VR headset market in the first quarter of this year thanks to sales of Quest 2 headsets.
“After years of reports that Apple has ambitions in AR/VR headsets, it will be interesting to see how the leading tech players compete in this emerging but promising market over the next decade,” White said, affirming his buy recommendation $230 price target for the company.
White was ranked 545 out of nearly 8,000 analysts tracked on the TipRanks platform. Additionally, 54% of its reviews have successfully generated 9% average returns over the past year.
Manufacturer of semiconductors and devices for wireless communication Qualcomm (NASDAQ:QCOM) is one of the leading companies in the worldwide rollout of the 5G broadband network. In addition, the company stands to benefit remarkably from the growth prospects of the Internet of Things (IoT) over the long term.
Aside from IoT, the company also has significant growth opportunities in the automotive technology market. The company’s Snapdragon Digital Chassis is a suite of cloud-connected platforms that support emerging automotive technologies such as digital cockpits and advanced driver assistance systems. (See Qualcomm dividend date and history on TipRanks)
Buoyed by these growth avenues, Ivan Feinseth, an analyst at Tigress Financial Partners, recently reiterated his buy rating on Qualcomm with a price target of $238. The analyst believes that 5G, IoT and automotive markets will accelerate business performance trends and increase long-term shareholder value.
Additionally, Feinseth believes that ample liquidity on Qualcomm’s balance sheet allows for investments in tech innovations and key growth initiatives, “further enhancing shareholder returns through regular dividend increases and share buybacks.”
Feinseth comes in as 333approx among nearly 8,000 analysts tracked on TipRanks. Additionally, 56% of its ratings were profitable, with each rating generating an average return of 9.5%.
Another top analyst pick is pizza company Papa John’s (PZZA). The company experienced tough sales all summer as the company is still reeling from negative customer sentiment over its former CEO’s controversies. Nonetheless, BTIG analyst Peter Saleh was positive about the stock’s prospects after a survey of several Papa John’s franchises.
“We believe Papa John’s is in the mid-stage of its sale and commercial turnaround after over two years of controversy and negative consumer sentiment weighed on the concept, pressured unit economics and store closures and financial support from the companies required,” Saleh said. (See Papa John’s International Stock Investors on TipRanks)
The analyst highlighted the pizza company’s new leadership, which has put together some strategies that could lead to a general trend reversal. These strategies have already improved papa johns Operating efficiencies, net unit growth and franchise focus, and Saleh expects these improvements to continue this year and next.
The analyst gave Papa John’s stock a buy rating but reduced the price target to $115 from $130 based on a reduced outlook for the next 12 months.
Saleh ranks 606th among approximately 8,000 analysts tracked on TipRanks. His reviews were successful 56% of the time, with each review yielding an average return of 8.8%.
camp of cooks
Another top picks from Peter Saleh is the grocer Chefs’ Warehouse (A COOK) that supplies fine dining restaurants, fine dining restaurants, food service establishments and specialty stores. Saleh reiterated his Buy rating and $48 price target on Chefs’ following the recent release of benchmark data. The data pointed to an uptick in the company’s high-end dining category, Knapp-Track High-End Steak, in September.
The analyst believes the reopening of offices and increased business travel in September supported this growth. Additionally, the fact that Chefs’ raised its full-year guidance while releasing quarterly results, just five weeks after the last outlook upgrade, gave Saleh confidence to remain bullish on the stock. (See Chefs’ Warehouse Insider Trading Activity on TipRanks)
Additionally, Saleh expects the fourth quarter to be the strongest period of the year as normal seasonality returns following last year’s omicron-related event and business travel cancellations or postponements.
In addition, the attractively discounted valuation at which cooks This trade is another reason for Saleh to consider the stock a buy.
“Shares are currently trading at just under 9.0 times our adjusted EBITDA estimate for 2023, well below their historical three- and five-year averages of 14.3 and 13.8, respectively. While the valuation has been pressured by broader economic concerns, we believe that a bearish scenario is more than reflected in stocks with valuations at their lowest levels in the last two years,” the analyst noted.
Omicron-led demand dampening and skyrocketing oil prices curtailed maritime trade earlier this year, causing the crude oil tanker market to remain sluggish. The crude oil tanker DHT Holdings (DHT) is still on a winning streak thanks to a surge in Spot Time Charter Equivalents (TCE) for mid-sized tankers.
Drewry analyst Nikesh Shukla was bullish on the stock in its recent company report update, in which he reiterated a Buy rating on the stock with a price target of $9. “News of political uncertainty in China combined with fears of a possible recession led to some correction in DHT’s share price over the last three weeks, but we expect it to recover in 4Q22 due to elevated VLCC (very large crude oil carrier). profit and robust seasonal demand,” Shukla said. (See DHT Holdings bloggers’ opinions and opinions on TipRanks)
A strong balance sheet is another positive that keeps Shukla’s stock upbeat. At the end of the second quarter, DHT’s leverage was 47.3%, well below its peer average of 90.5%. The analyst sees an improvement in this area over the next two years as the company deleverages.
Shukla noticed this DHT’Total liquidity of $293.9 million combined with relatively low leverage puts the company in a favorable position to navigate the business through tough times in the crude oil tanker market.
Shukla holds the 989th Rank among nearly 8,000 analysts tracked on TipRanks. Overall, 58% of the analyst’s ratings are profitable, each generating an average return of 11.8% over the past 12 months.