The Netflix logo is seen on a TV remote controller in this illustration taken Jan. 20, 2022.
Dado Ruvik | reuters
As earnings season approaches, investors are getting a glimpse of how companies are handling broader pressures.
Analysts can dissect these quarterly reports and help investors identify companies that can withstand near-term challenges and deliver attractive returns in the long term.
Finally, here are the five stocks favored by Wall Street’s top analysts, according to TipRanks, a platform that ranks analysts based on their past performance.
Netflix
streaming giant Netflix ,nflx) recently boosted third-quarter earnings per share, with a crackdown on password sharing helping it add more customers to its platform.
Evercore Analyst mark mahane said there were several key positives in the company’s third-quarter print, including 8.76 million subscriber additions, higher-than-expected Q4 2023 subscriber growth guidance and $2.5 billion of share buybacks. He also noted an increase of about $6.5 billion to the 2023 free cash flow outlook from previous guidance of at least $5 billion and price increases for basic and premium plans.
Mahaney said, “We believe that NFLX’s ad-supported offering and password-sharing initiatives constitute key Growth Curve Initiatives (GCIs) – catalysts that will drive material re-acceleration in revenue and EPS growth.”
The analyst believes the company is pursuing these GCI catalysts from a position of strength, given that it is a global streaming leader based on multiple metrics, including revenue, subscriber base and viewing hours.
Mahaney reiterated a buy rating on NFLX stock with a price target of $500. Interestingly, Mahaney is ranked 48th out of over 8,500 analysts tracked by TipRanks. Their ratings have been profitable 55% of the time, and each has returned an average of 25.4%. (Look netflix technical analysis on TipRanks)
NVIDIA
The next semiconductor is huge NVIDIA ,NVDA, The stock has seen a spectacular rise this year due to demand for NVDA’s chips in building generative artificial intelligence (AI) models and applications.
In a recently updated investor presentation, the company revealed the roadmap for its data center graphics processing units, central processing units and networking chipsets.
JPMorgan Analyst Harlan SurThe company, ranked 88th out of more than 8,500 analysts on TipRanks, said NVDA’s product roadmap signals two major changes. First, Nvidia has extended its product launch timing from a 2-year cycle to a 1-year cycle, which is expected to help the company keep pace with the increasing complexity of large language computation workloads.
Regarding the second major change, Sur said the roadmap indicated “more market segmentation (cloud/hyperscale/enterprise) by expanding the number of product SKUs (stock keeping units) that support a broader range of AI workloads (training/inference).” are optimized for the spectrum.”
The analyst believes that with these notable developments, the company is taking a multi-pronged approach to strengthen its data center market and technology. He affirmed a buy rating on the stock with a price target of $600, noting the growing demand for NVDA’s accelerated compute and networking silicon platforms and software solutions in the development of generative AI and large language models.
Sur’s ratings have been successful 64% of the time, with each rating giving an average return of 18.2%. (Look nvidia insider trading activity on TipRanks).
instacart
grocery delivery platform instacart ,cart) made its much-awaited stock market debut in September. Baird Analyst Colin Sebastian Recently initiated a Buy rating on CART stock with a price target of $31.
Clarifying his bullish stance, Sebastian said, “Despite a range of well-funded online and older retail competitors, Instacart enjoys a remarkable combination of scale, retail integration, vertical expertise and proprietary technology.”
The analyst highlighted that the essence of Instacart’s business model is an asset-light partnership strategy. He also thinks that Instacart’s data and technology sophistication are its key competitive advantages. He believes most food retailers may not be able to build similar internal e-commerce capabilities.
Most importantly, Sebastian considers Instacart’s advertising business to be one of the most successful launches in retail media, second only to the e-commerce giant. Amazon ,AMZN, He noted that consumer packaged goods advertisers are promoting their products by taking advantage of Instacart’s display ad formats that help reach targeted customers with relevant product ideas.
Sebastian is ranked 340th among over 8,500 analysts on TipRanks. His ratings have been successful 52% of the time, with each rating giving an average return of 10.7%. (Look instacart options activity on TipRanks).
SLB
Oilfield Service Company SLB ,SLB), formerly Schlumberger, recently reported better-than-expected third-quarter adjusted earnings. SLB said the oil and gas industry is benefiting from a multi-year growth cycle that has shifted to international and offshore markets, where the company claims to enjoy a dominant position.
goldman sachs analyst Neel Mehta The argument is that although there are no obvious near-term catalysts for SLB stock, the long-term growth story remains intact due to resilient customer spending. The analyst highlighted that Saudi Aramco is expected to spend approximately $245 billion by 2030, which represents approximately 5% to 6% annual growth. In addition, additional spending (at modest growth rates) is expected from UAE’s ADNOC, Qatar and other players in the region.
Noting that 80% of SLB’s revenue is from international and offshore markets, Mehta is confident that the company is well-positioned to take advantage of the long-term momentum in the Middle East.
“SLB continues to be the preferred way to gain exposure to international and offshore themes, with additional growth drivers in expanding their digital footprint with clients, which in our view is driving margin accretive at ~40-45%,” Mehta said. ”
Calling SLB a structural winner, especially during the pullback, Mehta reiterated a buy rating on the stock with a price target of $65. He is ranked 155th out of more than 8,500 analysts tracked by TipRanks. Their ratings have been profitable 65% of the time, each delivering an average return of 12.5%. (Look SLB Stock Chart on TipRanks)
Tesla
Our final name this week is the electric vehicle manufacturer Tesla ,TSLA, The company missed earnings and revenue guidance for the third quarter due to macro pressures, a highly competitive EV market and aggressive price cuts, which hurt its performance.
mizuho analyzer Vijay Rakesh noted that despite the sequential decline in the company’s third-quarter gross and operating margins due to lower pricing and Cybertruck R&D expenses, they remain at the higher end of legacy vehicle makers’ margins and well above rival EV makers’ margins. are above.
The analyst lowered his price target for TSLA stock to $310 from $330 to reflect near-term headwinds such as margin pressure, macro weakness and Cybertruck ramp challenges. Nevertheless, he reiterated a buy rating, noting that the stock is still trading at a discount to disruptive companies like Nvidia, while also generating massive profitability.
“We believe TSLA is leveraging market share, technology and cost leadership and is better positioned than peers to weather any turbulence in the broader auto market,” Rakesh said.
Rakesh is ranked 82nd among over 8,500 analysts tracked by TipRanks. Their ratings have been profitable 57% of the time, and each has returned an average of 18.6%. (Look tesla financial statements on TipRanks)
(TagstoTranslate)Tesla Inc(T)Schlumberger NV(T)Amazon.com Inc(T)Instacart (MapleBear Inc)(T)Nvidia Corp(T)Netflix Inc(T)Instacart (MapleBear Inc)(T)Tesla Inc(T) ) )Amazon.com Inc