Top Wall Street analysts say these stocks have the best growth prospects

0
270

Here are five such stocks selected by Wall Street’s top analysts, according to TipRanks, a platform that ranks analysts based on their past performance.

Here are five such stocks chosen by Wall Street’s top analysts, according to TipRanks, a platform that ranks analysts based on their past performance.

Zscaler

First, we will look at cybersecurity solutions provider Zscaler (

ZS

). The company’s fiscal fourth-quarter outlook and results were released earlier this month. They exceeded Wall Street expectations. That said, management cautioned that deals are taking longer to close due to a challenging macro backdrop.

Praising Zscaler’s performance, TD Cowen analyst Shaul Eyal said that the rising demand for the company’s Zero Trust solutions and disciplined spending drove the fourth-quarter outperformance.The analyst noted that over the past seven quarters, Zscaler’s annual recurring revenue (ARR) has doubled to $2 billion from $1 billion. The analyst also highlighted the large deals that Zscaler has closed, its strong pipeline and the growing federal contracts. Zscaler is a provider of services to 12 out of 15 cabinet-level U.S. agencies. Further, the company is investing in AI. It sees a huge potential for growth with its AI-powered capabilities. Data protection is provided to prevent sensitive data from being leaked through generative AI. Overall the analyst reiterated his buy rating for ZS with a $195 price target, stating that “Investments in AI Cloud and Go-to-Market are set to accelerate growth.” “

Eyal is ranked 9th among the more than 8,500 analysts who are tracked by TipRanks. (See Zscaler’s Financial Statements on TipRanks)

CrowdStrike Holdings

Another cybersecurity stock in this week’s list is

CrowdStrike

(

CRWD

), which recently reported upbeat fiscal second-quarter results and issued solid guidance. (See Zscaler’s Financial Statements on TipRanks)CrowdStrike HoldingsAnother cybersecurity stock in this week’s list is CrowdStrike (

CRWD

), which recently reported upbeat fiscal second-quarter results and issued solid guidance.

In reaction to the impressive performance, Needham analyst Alex Henderson raised his price target for CRWD stock to $200 from $170 and reiterated a buy rating on the stock. The analyst noted that the company achieved strong growth in new products under its Identity, Cloud, and LogScale Security Information and Event Management (SIEM) offerings.

The analyst also highlighted management’s commentary about the company’s generative AI cybersecurity product called Charlotte AI, which they believe can immensely improve execution for customers by automating workflows. He added that the use of AI helped the company enhance its own adjusted operating margin, which increased by 472 basis points to 21.3% in the fiscal second quarter.Henderson called CRWD one of his top recommendations in cybersecurity and said, “Crowd is taking market share with relatively stable pricing and strong new product uptake. “The analyst also said that the company’s managed services, which are core to the Falcon Complete offering, are enjoying high demand and differentiate the platform from others like Microsoft (

MSFT

).

Henderson is ranked 162nd out of more than 8,500 analysts monitored by TipRanks. He has been profitable in 58% of his ratings, and each one delivered an average return of 15%. (See CrowdStrike’s Technical Analysis on TipRanks) Chipotle Mexican GrillNext up is Mexican fast food chain Chipotle Mexican Grill (

CMG

). Baird analyst David Tarantino ranked 357 on TipRanks out of 8,500 analysts. He said that CMG was his top investment idea with a 12-month time horizon. Nevertheless, he feels that this pullback has created an attractive opportunity to buy CMG stock based on multiple positive catalysts that could emerge in the months ahead.

“Specifically, we expect signs of strong same-store traffic momentum and further pricing actions to lead to an upward bias to EPS estimates and support robust valuation metrics on CMG heading into year-end,” said Tarantino.

Additionally, he sees the possibility of CMG accelerating its unit growth to the high end of its target of 8% to 10% annually, supported by the hiring of additional construction managers this year. Tarantino estimates that a combination of about 10% unit growth and mid-single-digit comparable sales could drive low-to-mid teens revenue growth and more than 20% EPS increase, a profile which he believes deserves a premium valuation.

Tarantino reaffirmed a buy rating on CMG stock with a price target of $2,400. Each of his ratings has delivered an average return on investment of 10%. (See CMG Hedge Fund Trading Activity on TipRanks).

LululemonAthletic apparel retailer Lululemon (LULU

) impressed investors with its fiscal second-quarter performance and improved outlook. The company experienced strong momentum in North America and a spike in its international business, mainly due to robust sales in China.

Commenting on the 61% growth in sales from Greater China, Guggenheim analyst Robert Drbul said that he continues to believe that China holds significant growth potential for Lululemon, as the company aims to quadruple international revenues by 2026. He said that Lululemon plans to open the majority of its 35 international stores scheduled for this coming year in China. The analyst increased his earnings estimates for Fiscal 2023-2024 and believes the demand for merchandise from the company remains strong. He also believes that competitive pressures by upcoming athletic brands are overestimated. Drbul maintained a Buy rating on LULU with a $440 price target, justifying the fact that “the company stands to benefit from favorable secular headwinds” (health, fitness, casualization and wellness, including at home). “

Drbul is ranked No. TipRanks tracks 958 analysts out of over 8,500. Also, 57% have shown a profit with an average return 5%. (See Lululemon Insider Trading Activity on TipRanks)

Acushnet Holdings

The last stock on this week’s list is Acushnet Holdings (

GOLF), a manufacturer of golf products. Tigress Financial analyst Ivan Feinseth believes that the company is well-positioned to benefit from the ongoing growth in golf, driven by product launches and biannual new golf ball design introductions.The analyst highlighted that GOLF’s strong brand name continues to be a growth catalyst, as its Titleist brand golf balls remain the preferred choice of PGA and LPGA Tour players. He also noted the strong growth in Titleist golf clubs, Titleist gear, and FootJoy golf wear segments, fueled by a wide range of innovative launches, including new TSR models that rapidly emerged as the most-played model on the PGA tour.

Feinseth increased his price target for GOLF to $68 from $62 and reiterated a buy rating, while emphasizing that the company is enhancing shareholder returns through ongoing dividend increases and share repurchases.

“GOLF’s incredible brand equity, driven by its best-in-class and industry-leading product lines, including FootJoy and Titleist, are major assets and the primary drivers of its premium market valuation,” said Feinseth.

Feinseth is ranked 289th out of more than 8,500 TipRanks analysts. He has been successful 58% of the times, and each of his ratings delivered an average return 10.9%. (See Acushnet Chart on TipRanks).

.