Top Wall Street Analysts Favor These Three Stocks Over the Long Term

Investor concerns about the prospect of a sustained rise in interest rates returned, pulling the major averages lower last week.

Even though markets currently appear turbulent, it’s essential for investors to keep a long-term view and find stocks that can deliver attractive returns for years to come.

With that in mind, here are three stocks favored by the Street’s top professionals, according to TipRanks, a platform that ranks analysts based on their past performance.

This week’s top stock pick is cybersecurity provider Crowd strike (CRWD). The company recently impressed investors with strong quarterly results and optimistic guidance. It also announced the acquisition of Flow Security, which provides cloud data execution security solutions.

Mizuho analyst Gregg Moskowitz highlighted that CrowdStrike is seeing strong traction for its next-generation Falcon Cloud Security, Identity and LogScale SIEM (security information and event management) offerings, with management revealing that these products have collectively contributed over $850 million in annual recurring revenue.

The analyst also noted that the company closed several large deals in the fourth quarter, including more than 250 worth more than $1 million. Additionally, transaction volume increased 30% year-over-year across all customer cohorts.

Explaining his optimistic stance, Moskowitz said, “CRWD’s cloud platform remains highly differentiated, its GTM (go-to-market) is unmatched,” and the company is seeing more success beyond traditional security markets. end points.

The analyst sees CrowdStrike as a beneficiary of generative artificial intelligence. Moskowitz reiterated a Buy rating on CRWD stock and raised the price target from $360 to $390.

Moskowitz ranks 132nd among more than 8,700 analysts tracked by TipRanks. Its ratings have been profitable 62% of the time, each providing an average return of 16.5%. (See CrowdStrike ownership structure on TipRanks)

We move to the manufacturer of sports shoes and clothing Nike (NKE). Earlier this month, Guggenheim analyst Robert Drbul reiterated a buy rating on Nike stock with a $130 price target, adding it as a “best idea.” The analyst believes that the stock’s decline, down more than 8% in 2024, offers an attractive entry point with a favorable risk/return profile.

“We believe Nike is setting the stage for impactful new product launches (led by basketball, but also running) to accelerate its revenue growth in 2H24 and into 2025,” Drbul said.

The analyst noted that the company was focusing more on the highly competitive running category after losing ground in recent years. He expects the category’s growth to be supported by a series of new launches, including the Pegasus 41.

Drbul also expects the Nike brand to be highly visible during the upcoming 2024 Summer Olympics. Additionally, he believes the Jordan brand continues to be strong and presents a great opportunity for the company in the international, women’s and children’s segments. He pointed out that the Jordan brand is poised to become the second largest brand in North America.

Additionally, the analyst sees scope for gross margin expansion, with higher pricing, favorable ocean freight rates and supply chain improvements more than offsetting the impact of increased costs. product costs.

Drbul ranks 565th among more than 8,700 analysts tracked by TipRanks. Its ratings have been profitable 59% of the time, each providing an average return of 7.9%. (See Nike stock buybacks on TipRanks)

Warehouse chain Big BJ club (BJ) recently reported mixed fourth-quarter results. The company’s earnings beat analysts’ consensus estimates, but revenue, which rose 8.7% year over year, fell short of expectations.

Still, Baird analyst Peter Benedict was impressed with the company’s performance. He reiterated a buy rating on BJ stock and increased the price target from $80 to $90. The analyst noted that the company delivered encouraging key performance indicators, including traffic and units, even as disinflation continued to weigh on average basket size.

The analyst believes BJ’s is making good progress in transforming its general merchandise business through various efforts, including improving its assortment and product presentation and intensifying its marketing efforts. Interestingly, general merchandise sales are expected to surpass grocery sales in FY24.

Benedict also highlighted BJ’s strong real estate portfolio and plans to open 12 clubs this year. Additionally, he noted the retailer’s healthy membership trends, with membership revenue increasing 6.5% during the quarter and the term renewal rate remaining strong at 90%.

“With a healthy balance sheet and still reasonable valuation, we continue to highlight BJ as an attractive core GARP (growth at a reasonable price) idea for long-duration mid-caps,” the analyst said.

Benedict ranks 74th among more than 8,700 analysts tracked by TipRanks. Its ratings have been profitable 69% of the time, each providing an average return of 15.2%. (See BJ’s wholesale technical analysis on TipRanks)