Wall Street’s top analysts see these stocks as compelling games
Signage will be displayed at the ZoomInfo Technologies headquarters in Waltham, Massachusetts on Wednesday, June 3, 2020.
Scott Eisen | Bloomberg | Getty Images
How are investors supposed to find stocks that can outperform the recent round of market volatility?
One way is to track the activities of analysts with proven stock selection skills. TipRanks’ analyst forecasting service seeks to identify the top performing analysts on Wall Street or the analysts with the highest success rate and average return per rating.
Here are the analysts most popular stocks right now:
B2B intelligence company ZoomInfo Technologies had a strong performance in the fourth quarter of 2020 thanks to a recovery in the enterprise segment. For Stephens analyst Ryan MacWilliams, this solid presentation confirms his optimistic thesis, with the analyst confirming a buy rating. The five-star analyst was even more optimistic about his target price of 60 to 70 US dollars.
On the details of the print, ZI’s revenue exceeded consensus estimate by $ 9.1 million, with FY21 revenue growth forecast also beating analysts’ expectations. The company rounded out 2020 with over 850 customers contributing over $ 100,000 to ACV, up from 580 in the year-ago quarter.
“Additionally, it was encouraging to see net dollar peg rebound by the second half of 20 (although it was just below FY 19) as midsize / corporate retention momentum exceeded Q4 2019 levels in Q4 2020,” noted MacWilliams .
Additionally, ZoomInfo increased its engagement rates for new business (to 28%) and renewals (to 44%) at Engage in the fourth quarter. “We believe that Engage / new integrations could improve customer loyalty as ZoomInfo solutions become increasingly integrated into workflows (2 billion ZoomInfo automated API calls in FY 20; ~ 2x volume in FY 19),” commented MacWilliams.
It should be noted that “Sales Intelligence market has likely seen three to four year growth in market growth due to COVID (especially as ~ 80% of B2B buyers now prefer the new normal for distance selling),” MacWilliams said. He also argues that investors don’t fully appreciate the upsell opportunity with new products like Engage and Intent Data.
“We therefore believe that ZI’s key metrics and greenfield market opportunities should help them grow into their premium ratings. ZoomInfo is currently trading at 29x the CY22-EV / revenue multiple of the fast-growing SaaS -Peers at 20 times its value. Finally, it is worth noting that this is possible. ” An NT headwind for performance as sponsors increase their post-lockup stock sales after this strong showing, “explained MacWilliams.
Based on data from TipRanks, MacWilliams has a 72% success rate and an average return of 29.6% per review.
National Research analyst Ben Klieve said that agricultural company The Andersons “finished a challenging year on a strong note, with the facility getting more convincing through 2021”. Against this background, the analyst kept his buy recommendation and target price of 32 USD unchanged.
Despite headwinds from COVID in the ethanol and rail segments, the company posted an adjusted EBITDA of $ 85 million. This reflected a slight year-over-year gain, beating the street’s claim for $ 83 million. The strong result was due to the strength in the retail segment.
“As COVID-19 continues to slow rail traffic and reduce ethanol demand as a backdrop, we continue to be impressed with the relative stability of the Rail and Ethanol segments. We believe the outlook for Rail is stable as we see several upside sources fueled by ethanol increased transport activity, favorable political initiatives by a Biden administration and the creation of the new ELEMENT facility, “explained Klieve.
In addition, Klieve believes that both the retail and plant nutrients businesses have “a significant improvement from 2020 to 2021”.
Looking ahead, although ANDE has been bouncing since mid-2020, Klieve believes the stocks have even more headroom due to “favorable conditions across the Ag economy and several potential catalysts from the ethanol segment”.
As evidence of its impressive track record, Klieve has achieved a 62% success rate and an average return of 28.2% per review.
Communications technology company Casa Systems just got a thumbs up from Tim Savageaux, an analyst at Northland Capital. After the publication of the fourth quarter, the top analyst confirms a buy rating and his target price of USD 12.
According to Savageaux, the print “has once again highlighted the diversification of CASA’s exposure to fiber, cable and wireless broadband access markets, with much stronger wireless revenue offsetting weaker fixed-line telecom rates as well as the company’s increasing traction in CPE packages with fixed wireless access core- and RAN markets for 4G / 5G radio are highlighted by a significant new 5G mm wave CPE win. “
The analyst added, “In addition to having a solid base in Cable, we see significant growth potential in fiber and radio.”
In terms of Casa’s quarterly performance, revenue was $ 120.5 million, up 14% from the previous quarter and 7% year over year. The number also surpassed Northland Capital’s analyst estimate of 107.3 million. This was mainly driven by record wireless device sales of $ 50.4 million.
It should be noted that given the variability across its product lines, the company’s focus has shifted to gross margin and operating dollar growth.
That is, based on “the hardware-elastic mix of cable turns in CY20 as well as the increase in software content in wireless (packet core) and fixed (virtual router / gateway), the overall operating result and the EBITDA guide, which implies a modest increase in GMs from the 50th , 2% of the CY20 could be conservative, “said Savageaux.
Savageaux is ranked 208th on TipRanks’ rankings with a 64% success rate and an average return of 21.2% per review.
In a research report titled “Positioned for Further Growth in 2021,” Canaccord Genuity Analyst Michael Graham explains his optimistic case for EverQuote. To that end, he kept a buy rating and a price target of $ 65.
Jayme Mandel and EverQuote put in an impressive performance as CEO when they first called up the results. The year-on-year sales growth of 32% slowed only slightly compared to the previous quarter. Additionally, EBITDA and VMM exceeded management’s forecasts and Graham’s estimates.
Additionally, EverQuote’s newer industries are growing faster than the core auto industry, growing 55% year over year. This result was supported by a strong open enrollment period for the Healthcare Industry. It should be noted that the auto-vertical was still up 27% for the quarter.
“The strategic roadmap for the company appears to be developing modestly in terms of continued strength at its core, and we anticipate that in 2021 the focus will be on DTC in Health & Life, with additional bundling in these two industries, to mimic the success with Home & Auto bundles – and more of a branded experience for consumers and more branded advertising to fuel the model, “commented Graham.
The company also has deep integrations with all but one of its carrier partners, up 72% from the previous quarter. One hold-out is currently in the process of completing the integration. According to Graham, “these shortcuts remove the friction in the user experience and provide better performance for partner carriers. The company plans to continue investing in this area in FY21, including facilitating more online and offline connections on behalf of local agents and.” Enable online offers and purchases of household, health and life policies. “
“With this development and the ongoing secular tailwind in the digitization of insurance purchases, we believe 2021 will be another good year for EverQuote’s business and stock,” said Graham.
Graham ranks 100th on the TipRanks list and has a 65% success rate and an average return of 27.2% per review.
The Barnes Group, which manufactures precision metal components and assemblies for industrial and aerospace applications, remains a top choice for Oppenheim-based analyst Christopher Glynn. The analyst has given the share a buy rating. In addition, Glynn gave the price target a boost, moving the number from $ 50 to $ 60.
For the past quarter, Aero sales increased 11% sequentially, “slightly” above Street estimates. However, management stated that Aero AM sales are expected to be lower in 2021, which includes a “tough comparison for the first quarter”.
“Aero OE recorded 1.6xb: b in its strongest orders since the third quarter of 2019, with Industrial b: b slightly above 1.0. The order backlog increased sequentially by 7% (-23% year-on-year) for Aero OE and total B, with Industrial up 9% (long cycle weighted; residue conversion weighted favorably by 1Q and 2H), “explained Glynn.
Going forward, the company anticipated adjusted earnings per share of $ 1.65 to $ 1.90 for 2021 sales in the high single digits. “Timing / delivery plans in longer cycle companies favor sequential improvements after the first quarter,” added Glynn.
All of this led Glynn to argue that, “Given its differentiated long-term portfolio management and track record in operational resilience and as an acquirer, Barnes stock offers long-term value creation opportunity. The content wins in the aerospace industry with themed organic penetration capacity for the potential of the Industry portfolios for an expanded aerospace reset. “
With a 67% success rate and an average return of 17.9% per rating, Glynn ranks 202 on TipRanks’ list of Top Performing Analysts.