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On Wall Street, stocks are taking a hiatus after this month’s rally. Despite encouraging updates on a potential coronavirus vaccine, disappointing unemployment data and a spike in coronavirus cases have scared investors.
Not helping investor sentiment, New York City Mayor Bill de Blasio announced schools would return to distance learning to mitigate the spread of the virus.
“The market has really been in festive mode since polling day and crossed it again last week. I think the idea now is that people are starting to consider taking profits before the expectations that capital gains taxes might increase in 2021. I also think there is the inclusion of the transition. from COVID to post-COVID … Even with the resurgence, all the vaccine news tells us [is] there is a post-COVID coming, ”noted Oppenheimer’s chief investment strategist John Stoltzfus.
Since many question marks remain, it is not easy to spot which stocks are likely to outperform the market as a whole. One approach is to draw inspiration from analysts with a proven track record of success. TipRanks’ analyst forecasting service attempts to identify the top performing analysts on Wall Street. These are the analysts with the highest pass rate and the average return per rating.
Here are the five favorite stocks of the best performing analysts right now:
In response to promising coronavirus vaccine data from Pfizer and Moderna, investors have moved away from beneficiaries of the pandemic such as Amazon. However, five-star analyst Laura Martin continues to take a bullish stance on the e-commerce and IT giant. To that end, it reiterated a buy note and a price target of $ 3,700 (upside potential of 19%) on November 18.
In the wake of the vaccine news, Martin conducted a survey to assess consumer buying habits and future plans. Surveying around 330 consumers, 80% of respondents said they would buy the same or more online after the pandemic. “AMZN being the market share leader in e-commerce, we see it as the biggest beneficiary of this trend,” she commented.
When Martin asked if their buying habits would change when a vaccine became available, around 69% said they would use Amazon in the same way they did during the pandemic, which is when Amazon demanded increased, while 15% said they would shop even more at the site.
As for the upcoming holiday season, the analyst wanted to know when consumers would be shopping. Of those polled, 44% said that 50-100% of their vacation shopping has already been done.
“In our opinion, Amazon’s Prime Day in October pushed the purchasing schedule forward. Given that it had the first-mover advantage, we expect AMZN to be the biggest beneficiary of spending that move earlier in the schedule, ”Martin explained.
With a 66% pass rate and an average return of 24.9% per rating, Martin ranks 67th on TipRanks’ list of top performing analysts.
Five-star analyst Matthew Hedberg of software development firm Bentley Systems, RBC Capital, will buy on hold on November 15. With a price target of $ 43, the analyst sees a potential upside of 26%.
The upgrade follows an impressive performance in its first quarter as a publicly traded company. That, combined with a pullback since mid-October, makes the risk / reward profile much more attractive, according to Hedberg, as stocks now trade “closer to their peers and at a discount to premium peers such as Ansys and Autodesk “.
During the quarter, Bentley generated revenue and EPS of $ 203 million and $ 0.17, respectively, compared to consensus estimates of $ 197.3 million and $ 0.13. In addition, Adjusted EBITDA reached $ 73.6 million, easily beating the street appeal of $ 56.5 million. Most notable for Hedberg, however, was the ARR’s 9% growth, which exceeded its 8% projection.
Looking forward, Bentley’s forecast for CY20 is also higher than the consensus estimate.
Hedberg added, “Overall, we think a vaccine could benefit Bentley, and a Biden presidency could boost infrastructure spending in the US. Overall, we like the opportunity to own a long-term sustainable winner. “
Arriving in the Top 25 of the TipRanks rankings, Hedberg has a 74% success rate and an average return of 27.2% per note.
On November 17, PDF Solutions announced the acquisition of Cimetrix, a capital goods software interface company that enables data collection from manufacturing tools. For Gus Richard of Northland Capital, this agreement reaffirms its bullish thesis, the analyst reiterating a buy note the next day. Along with the call, he continues to assign a price target of $ 30, suggesting a potential upside of 43%.
Under the terms of the deal, PDFS will pay $ 35 million in cash, net of cash on Cimetrix’s balance sheet, with the deal expected to be completed in the fourth quarter of 2020.
This move is part of PDF Solutions’ goal to accelerate its efforts with equipment vendors, as Cimetrix provides a sales channel for equipment vendor software development teams, with Cimetrix data serving as the “raw material for PDFS’s Exensio Big Data Analytics Platform ”. Richard’s opinion. The PDF platform has penetrated fabs, factories and OSATs, but the exposure of equipment suppliers is limited.
“Together, PDFS / Cimetrix can enable equipment vendors to collect operational data on equipment and use the PDFS Big Data Analysis Platform and AI to analyze operational, performance and performance data. process control of equipment. process control, equipment availability and MTBF reduction. This acquisition brings Exensio closer to the standard de facto big data analytics platform for the semiconductor industry and expands the business to electronics manufacturing services, EMS and display manufacturing, ”said Richard.
Based on analyst estimates, the acquisition could be accretive over CY21, with an addition of $ 0.02 to $ 0.04 to earnings.
TipRanks shows that the No.52 ranked analyst has an impressive 72% success rate and an average return of 28.2% per rating.
Cytokinetics, a biopharmaceutical company that is developing muscle activators and muscle inhibitors as potential treatments for people with debilitating conditions that compromise muscle performance, has just received a boost from Joseph Pantginis of HC Wainwright. In addition to maintaining a buy rating on November 16, it maintained a target price of $ 43 on the stock, which implies a potential upside of 180%.
Pantginis tells customers that omecamtiv mecarbil, its selective cardiac myosin activator for the potential treatment of heart failure with reduced ejection fraction (HFrEF), “continues to show promise for a large, pre-specified population. “
In October, CYTK and its partners, Amgen and Servier, said the therapy met the primary composite efficacy endpoint of reducing CV deaths or HF events, but not the secondary endpoint of reducing CV deaths. That said, last week, Cytokinetics presented the results of GALACTIC-HF, the Phase 3 omecamtiv outcome study, to the AHA, demonstrating that the drug shows a potentially greater treatment effect in the pre-specified group of patients with more severe HF, represented by a left ventricular ejection fraction (LVEF).
It should be noted that the “fate” of omecamtiv may hinge on “Amgen’s perspective on the drug, as well as a full analysis of the data and the results of a market research focused on the opinions of consumers. doctors and payers, ”according to Pantginis. However, the analyst remains optimistic.
“While further analysis is yet to be conducted and more details are needed to clarify the real opportunity of omecamtiv in HF, we believe these results suggest a possible path for the approval of omecamtiv based on its applicability for treating a defined and significant population, “Pantginis explained.
Pantginis is ranked No. 169 out of 7,093 analysts followed by TipRanks.
For RBC analyst Shweta Khajuria, Yelp is currently one of her top stock picks. In a bullish signal, the five-star analyst lowered the price target from $ 29 to $ 34 (upside potential of 7%), and reiterated a buy note on November 18.
Khajuria tells customers she has viewed Yelp as a “vaccine stock for several quarters now, and the case is the recent stock price rally after Pfizer’s vaccine announcement.”
Explaining this, the analyst said, “While there is a lot of uncertainty between now and the actual large-scale vaccine distribution, we believe Yelp is well positioned to profit from the recovery, given the improvement in fundamentals that we saw in the third quarter. and based on our belief that the rollback in restaurants and bars, beauty and fitness, health and shopping will be relatively rapid as the economy opens up. This in addition to improving home and local trends through product improvement and tailwind. “
In a post-coronavirus environment, Khajuria believes Yelp could benefit from the improving macroeconomic environment as the economy opens up, given that ad spending is correlated with GDP growth. Additionally, the product changes that have been a priority for the company over the past year and a half should bode well for Yelp, the analyst said.
“Management expects Yelp to leverage more of its improved advertiser value proposition, both perceived and actual, to take a larger share of advertiser budgets,” Khajuria added.
As for its go-to-market strategy, although Yelp’s local sales force is down 45% year-over-year, management expects to keep its sales force intact even after the coronavirus, which is positive, according to Khajuria.
Khajuria currently has an 89% success rate and an average return of 80.3% per note.