Investing

In this article

Source: NYSE

Earnings season is yet again upon us, with prominent names reporting this week. Volatility remains a focus for investors, and inflation has been continuing to compound pressure across all industries. The near-term uncertainty remains blurred, although long-term investing can often cut through the daily noise.  

Let’s take a look at five stocks that analysts see performing well in the future.  

Ebay  

Rising inflation doesn’t hurt everyone equally, with those in lower socioeconomic strata and younger folk feeling the full force of impact. When a company is involved in e-commerce, it helps to have lower cost options in one’s offering. For eBay (EBAY), this comes in the form of refurbished and pre-owned product categories, an area which the firm is expected to expand.  

Colin Sebastian of Robert W. Baird recently reported on the online marketplace and auction site, noting that in regards to inflation “eBay’s unique offering of pre-owned and value merchandise should mitigate those headwinds, or even benefit the platform.” He went on to explain that Gen Z consumers are highly interested in this segment, with 80% of them buying the goods, according to a company survey.  

Sebastian rated the stock a buy, and added a price target of $80 per share.  

The top-ranked analyst went on to elaborate that “the platform’s value-price orientation could help offset consumer spending softness among lower and middle-income consumers.” 

In the near-term, the analyst expects EBAY to make several announcements such as a digital wallet and a heightened focus on auto parts sales. (See Ebay Website Visits on TipRanks.) 

When reporting quarterly earnings, e-commerce firms have had a rough time beating pandemic-era comparisons, as slowing consumer trends compound with supply-side constraints and an inflationary environment. Ebay is anticipated by Sebastian to meet its guidance come May 4, although a beat and raise would be highly bullish considering these challenges.  

Out of nearly 8,000 analysts on TipRanks, Sebastian ranks as #158. His success rate stands at 52%, and he maintains an average return of 37.1% per rating.  

Alphabet  

Tech has been one of the hardest hit sectors as of late, as many of its large firms were still considered risk-on and overvalued when the economy took a turn. However, Google parent company Alphabet (GOOGL) was largely insulated from the damage, due in part to its ads segment being mostly protected from Apple’s (AAPL) iOS 14.5 privacy update last summer.  

Now, after weathering the storm, Brian White of Monness said he expects the stock to be steady and sound, heading into its earnings call on Tuesday. In his recent report, he noted that GOOGL performed better than the average stock in his coverage, and elaborated that “we believe Alphabet will continue to benefit from the secular digital ad trend and experience strength in the cloud.” 

White rated the stock a buy, and added a price target of $3,850 per share.  

He is also excited for Alphabet’s investor conference in mid-May, which could stir up some encouraging investor sentiment for the technology conglomerate.  

Thus far, White stated that platforms like Google Search and Youtube Ads have been driving growth, largely undisturbed by Apple’s software changes. Companies like Meta Platforms (FB) and Snap (SNAP), however, have much to worry about. (See Alphabet Stock Charts on TipRanks) 

On the legislative front, the highly accurate analyst did admit that Alphabet will most likely see continued antitrust litigation in the U.S., and is currently dealing with some disruptions from the recently passed European Digital Markets Act (DMA). 

On TipRanks, White is rated as #171 out of nearly 8,000 analysts. He has been correct on 65% of his stock picks, and has returned an average of 29.7% on each of them.  

Booking Holdings  

Just by going onto any travel search engine, one can tell the global rebound in demand is back in full swing. Prices have skyrocketed across the board as pent-up consumers seek to finally have a summer vacation, see family, or just experience something new for a change. After last summer was derailed by the delta variant, it appears this one is set in stone. Compounded by mask mandates coming off domestically, Booking Holdings (BKNG) is in for a strong Q2.  

Tigress Financial’s Ivan Feinseth identified these upsides in his recent publication, noting that the travel search engine conglomerate is set to benefit, as it is already experiencing high growth from its hotels, flights, and rental car segments.  

Feinseth rated the stock a buy, and bullishly raised his price target to $3,210 from $3,150. 

In addition to the obvious resurgence in both corporate and leisure travel and excurisons, the five-starred analyst mentioned that “BKNG continues to benefit from advertising, merchant, and other business lines experiencing strong growth as well.” 

Booking is expected to report its first-quarter earnings on May 4.  

The company has also made several encouraging acquisitions that have strengthened its vertically integrated ecosystem. Companies like Getaroom, FareHarbor, and Etraveli are all anticipated to provide a robust consumer experience.  

Feinseth wrote that “BKNG’s market-leading position, strengthened by its strong brand equity and diversified global footprint, together with its solid execution ability, technologically advanced platform, and realization of value from its complementary acquisition strategy” are all expected to continue providing gains.  

Out of TipRanks’ almost 8,000 analysts, Feinseth ranks as #65. He has been successful when rating stocks 68% of the time, and has an average return of 30.1%.  

Kornit Digital  

Over the last few years, the world of fast fashion has seen massive growth, yet the industry’s manufacturing methods continue to remain in the past. Environmental concerns remain prominent for large industry players, and smaller ones wouldn’t mind cutting costs, either. In comes Kornit Digital (KRNT), an Israeli digital printing systems firm currently disrupting supply chains.  

While shares were down considerably year-to-date at last glance, some analysts see a newly discounted growth opportunity.  

One of those bullish voices in the crowd is James Ricchiuti of Needham & Co., who wrote that Kornit’s “business remains healthy” and he foresees “strong tailwinds” for the next year and a half. KRNT’s business model is supported by its direct-to-garment and direct-to-fabric waterless printing systems, and is positioned to continue capturing market share in its industry.  

Ricchiuti reiterated a buy rating on the stock, and lowered his price target to $155 from $202. The downgrade in price target comes off the back of an overall decline for growth and tech names across the stock market. (See Kornit Digital Risk Factors on TipRanks) 

Kornit has been acquiring both large and smaller customers, and is experiencing strong momentum from clients wishing to emphasize sustainability. The five-star analyst wrote: “Leading apparel retailers in recent weeks have highlighted the need to de-risk supply chains through near-shoring and on-shoring strategies, while at the same time, large e-commerce apparel companies have emphasized the importance of adopting advanced digital production work flows to deliver short-run and custom orders more rapidly.” 

Out of almost 8,000 expert analysts, Ricchiuti maintains position #144. He has been right on his stock picks 62% of the time and has an average return of 27.8% on each of them.  

Carvana  

Along with the rest of tech, e-commerce, and pandemic-driven stocks, Carvana (CVNA) has come down significantly over the last couple of quarters. Shares are over 77% off from their August 2021 highs, and now macroeconomic headwinds have been holding its business model back. The large e-commerce used automotive dealer has seen impacts on its volumes, and thus its margins, although its management has said the path to a rebound is clear.  

Agreeing with this sentiment is Scott Devitt of Stifel Nicolaus, who noted that Carvana has been taking steps to “normalize service levels, shorten delivery times, and improve inventory levels.” If the right moves are to be made, the current challenges faced by the company could be short-lived.  

Devitt rated the stock a buy, and modestly lowered his price target to $140 from $170.  

The highly ranked analyst argued that the current narrative surrounding the company and its concurrent downtrend in share price is overexaggerated, and that now its shares represent a considerable discount.(See Carvana Website Visits on TipRanks) 

In his report, he wrote that “operational improvements should result in sequential growth in unit volumes, revenue, and GPU [gross profit per unit],” though the slowdown in the overall market blurs near-term visibility.  

Cementing his hypothesis on the stock, Devitt mentioned that Carvana is the “leading eCommerce platform and is well positioned with the infrastructure, technology, and expertise required to operate a nationwide network.”  

Out of nearly 8,000 professional analysts, Devitt ranks as #538. He maintains a success rate of 49%, and has an average return of 19.7%.  

Articles You May Like

Kentucky’s Bellarmine University downgraded to B1 by Moody’s
Starboard sees an opportunity to create value at Riot Platforms amid growth in hyperscalers
SEC charges Silver Point Capital with nonpublic information policy failures
Cyber event cited in Palomar Health ratings falling further into junk territory
US Senate votes through last-gasp bill to keep government open