Daily Archives: February 26, 2018

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5 Hot Stocks With Huge Revenue Drivers Ahead

Which five hot stocks have juicy growth prospects ahead? Look no further!

All five stocks covered below are primed for significant expansion in the coming months. Stocks are already recovering from the recent market pullback, and these stocks, in particular, boast big catalysts that can push prices higher.

And you don’t have to just take my word for it. Each of these stocks has serious backing from the Street’s top analysts. I used TipRanks to ensure that the analysts referred to here are the best-performing analysts on the Street.

That means a high success rate and average return. These are the analysts you can trust for their precise stock picking ability.

So without further ado, let’s dive in:

Hot Stocks to Buy: Amazon (AMZN)

Source: Shutterstock

Now at an eyebrow-raising $1,500, Amazon.com, Inc. (NASDAQ:AMZN) does not immediately strike you as a cheap stock to buy. However, the valuation becomes increasingly attractive when you think of the multiple revenue drivers ahead. “We continue to think Amazon is the best growth story of all the mega-caps over the very long term,” analyst Rob Sanderson wrote recently. He sees the stock reaching $1,750 in the coming months (17% upside potential).

For example, the company is now reportedly planning a new service to pick up packages from businesses and deliver them to consumers. According to the Wall Street Journal, “Shipping With Amazon,” is expected to start in LA and roll out more broadly within the year. And Baird’s Colin Sebastian says that with “just 1% of the market, Amazon could create a new $5B revenue stream.”

Meanwhile, Amazon’s content strategy is also blossoming. The company has just poached NBC Entertainment president Jennifer Salke for Amazon Studios. And maybe you haven’t heard of Twitch, but Amazon’s live streaming video platform is now apparently bigger than CNN. Macquarie analyst Ben Schachter says Twitch aggregate viewership continues to rise, and that display ads on properties like Twitch contribute significantly to Other revenue. Note that “Other revenue” soared 58% to $4.65 billion in 2017.

Overall, the stock has a very bullish outlook from the Street. Out of 36 analysts polled by TipRanks in the last 3 months, 34 are bullish on Amazon stock with just 2 left on the sidelines. These analysts have an average price target on AMZN of $1,664.


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Hot Stocks to Buy: T-Mobile (TMUS)

Source: Via T-Mobile

T-Mobile US, Inc. (NYSE:TMUS) is the third-largest wireless carrier in the US. The company is easily outpacing competitors, capturing most of the industry growth since 2013. This is down to: 1) a greatly improved network, and 2) targeted marketing for under-served urban and rural areas. In 2017, for example, TMUS opened 1,500 T-Mobile-branded stores and 1,300 MetroPCS-branded stores.

Encouragingly, top Oppenheimer analyst Timothy Horan sees no signs of growth slowing down. On the contrary: “T-Mobile’s revenue margin expansion, coupled with ongoing subscriber momentum, supports our Outperform rating. TMUS is expanding geographically and is aiming to aggressively deploy its 600 MHz spectrum for increased coverage/capacity.”

This aggressive expansion should mean significant cash flow generation for TMUS — and a corresponding rise in share prices. Horan has high hopes that these share gains and lower churn will drive core EBITDA growth of 10%+ per year. As a result, this five-star analyst has a $75 price target on the stock (25% upside potential).

Our data shows that TMUS scores straight As from the Street. Including Horan, nine analysts have published TMUS Buy ratings in the last three months. Moreover, the average analyst price target of $74 indicates big upside potential of almost 24%.


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Hot Stocks to Buy: Caesars Entertainment (CZR)

Source: Shutterstock

Global gaming empire Caesars Entertainment Corporation (NASDAQ:CZR) is back! After emerging from bankruptcy in 2017, the company has effectively restructured and reorganized.

Now the company is focusing on the critical task increasing revenue growth. “Our future appears bright with a much-improved balance sheet, approximately $2 billion in cash, and strong free cash flow” management stated recently.

Top Oppenheimer analyst Ian Zaffino gets the hype. He has just reiterated his CZR buy rating with a $15 price target (14.5% upside potential). “We continue to recommend CZR based on its impressive opportunity set” says Zaffino. He sees ‘numerous levers’ for the company to pull, from higher revenue for renovated rooms to real estate development and meaningful acquisitions (such as a potential casino license at the $8 billion Elliniko project in Greece).

Interestingly, hedge funds are also very bullish on CZR right now. Funds increased holdings in by over 360% in Q4 with the combined purchase of over 50 million CZR shares. The total value of CZR shares held by hedge funds now totals over $8.4 billion.

In the last three months only two top analysts have published ratings on CZR (both a Buy).


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Hot Stocks to Buy: UnitedHealth (UNH)

UnitedHealth (UNH)

Source: Shutterstock

One of the US’s largest insurance companies, UnitedHealth Group Incorporated (NYSE:UNH), makes a very compelling investing proposition right now. Analysts are excited about the “favorable growth opportunities” for UnitedHealth in Latin America markets due to its Banmedica acquisition in Brazil. The $2.8 billion deal closed on Jan. 31.

For five-star Oppenheimer analyst Michael Wiederhorn: “the opportunity from the International business should represent a new avenue of growth that could help drive impressive long-term returns.”

He calls the stock his Best Idea for Feb-March and explains that “UNH is well positioned by virtue of its diversification, strong track record, elite management team and exposure to certain higher growth businesses.” Meanwhile its lucrative Optum tech business continues to account for a large share of earnings. Wiederhorn (one of the Top 50 analysts on TipRanks) has a $260 price target on UNH (13% upside potential).

Not surprisingly, UNH has 100% support from the Street. In the last three months, the company has received 11 buy ratings from analysts. So no pesky hold or sell ratings here. The $267 average analyst price target suggests just over 16% upside potential from the current share price.


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Hot Stocks to Buy: Alphabet Inc (GOOGL)

Source: Shutterstock

Last but not least, we have Alphabet Inc (NASDAQ:GOOGL), the umbrella company for Google and YouTube. If you think that GOOGL has already peaked, think again. Top Robert W. Baird analyst Colin Sebastian spies several exciting catalysts ahead as the company moves more aggressively in key markets. He adds the stock as one of Baird’s ‘Fresh Picks’ with a $1,300 price target (vs the current $1,128 share price).

A key catalyst lies in Amazon’s monster cloud business, Google Cloud. For the first time, GOOGL CEO Sundar Pichai has just disclosed that Google Cloud makes about $1 billion quarterly. That’s a massive $4 billion for GOOGL in annual revenue. However, this is still well behind Amazon’s AWS cloud unit and Microsoft’s Azure.

As a result, Sebastian sees big growth potential here.

He asks: “Will it take Google the 12 years it took Amazon?” No, Google will probably have a $20 billion cloud business in five years. And from an Amazon perspective, probably $150 billion of its market cap is probably AWS. [Cloud] is not recognized within Alphabet’s valuation — I think transparency will go a long way.”

TipRanks reveals that Sebastian is an analyst worth tracking. He is ranked as one of the site’s Top 10 analysts out of over 4,700 due to his impressive stock picking ability.

Overall, GOOGL boasts a firm ‘Strong Buy’ analyst consensus rating. In the last three months, analysts have published 24 buy ratings on the stock vs just 3 hold ratings. On average, these analysts see GOOGL spiking 16% to reach $1308.


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Growth Stocks

How to Profit from Demand Destruction of Oil

In the latest annual energy outlook from BP PLC (NYSE: BP), it was the first time the company forecast oil demand would eventually peak and then steadily decline. BP put the date for peak oil demand in the late 2030s.

And the cause is one I’ve told you about quite often in my articles – the rise of electric vehicles. BP said there would be 300 million electric vehicles on the road by 2040, up from about 3 million today. BP says electric vehicles will account for only 15% of the roughly 3 billion cars on the road in 2040. But they will account for 30% of all passenger car transportation, as measured by distance traveled, because so many of them will be shared vehicles, à la Uber.

BP’s outlook also envisaged renewable power growing from just 4% of global energy consumption today to 14% in 2040.

Add all of that up and you can surmise that a lot of changes are ahead for the oil industry. Yet only some of the world’s major oil companies are preparing for what the future will hold.

Your Friendly Neighborhood Power Provider

The oil companies that seem to have begun the process of adapting to a lower carbon economy are located across the pond in Europe. These include Royal Dutch Shell PLC (NYSE: RDS.A and NYSE: RDS.B), Total SA (NYSE: TOT) as well as the aforementioned BP. Both Shell and Total, for example, have invested heavily into natural gas as a cleaner alternative to coal for power generation.

But now the two companies are moving forward with even more ambitious plans.

Both Shell and Total are moving into the consumer power market. The reason is obvious to the head of Shell’s “new energy” strategy, Maarten Wetselaar. He forecast that the proportion of global energy consumption to be met by electricity will climb from less than 20% currently to about 50% over the next few decades.

This outlook is largely in agreement with the forecast of BP, which can be seen in the chart below:

Both companies have also moved into renewable energy. In January, Shell bought a 44% stake in the U.S. solar energy company, Silicon Ranch Corporation, for $217 million. And last October, it purchased NewMotion, which operates one of Europe’s largest electric vehicle charging networks. The company also has a 20% stake in the huge Borssele offshore wind project off the coast of Holland.

Total’s strategy is similar. It paid nearly $300 million for a 23% stake in the French renewable energy company, Eren. It also spent $2 billion (about a billion each) over the past few years buying the U.S. solar company, SunPower, and the French battery developer Saft. The latter makes specialized long-life lithium-ion batteries for industries including telecommunications, medicine, aerospace and defense. Its products are installed in two-thirds of the world’s commercial aircraft and over 200 satellites.

The management at both companies acknowledge that the global energy market – long dominated by oil – is beginning to give way to a lower-carbon system, with much larger future roles for natural gas and renewable power. And both companies are already laying the foundation for such a future by moving into the selling of power…

Shell is close to completing its acquisition of First Utility, the UK electricity and gas supplier, which it agreed to buy last December in a deal that will pit it against the U.K. ‘s larger power suppliers. Meanwhile, Total is in the early stages of building a retail energy business in its domestic French market to challenge the country’s incumbent power providers.

These acquisitions are all part of the long-term strategy of these companies. It’s a rather straightforward strategy too – to sell the power from their own renewable and other energy sources (such as natural gas) through their energy trading businesses to customers, both commercial and to a lesser extent, residential.

Shell, for instance, already is among the largest power traders in both Europe and North America. And given its size and scope, it may become a supplier of choice for many large industrial customers, threatening the long-term viability of existing utilities.

Related: Dump These Energy Stocks Before the Next Correction

What the Other Oil Companies Are Doing

Most of the other major European oil firms are moving down the same path as Shell and Total, albeit at a slower pace. BP has owned a large U.S. wind business for many years and in December signed a $200 million deal to buy Lightsource, a U.K. solar power developer. Even Italy’s Eni SpA (NYSE: E) and Norway’s Statoil ASA (NYSE: STO) are investing in solar and offshore wind, respectively.

Yet the two U.S. giants – ExxonMobil (NYSE: XOM) and Chevron (NYSE: CVX) – have largely not followed their European peers into other forms of energy besides oil. They seem content being dinosaurs drawing jeers from climate activists.

Exxon and Chevron are ignoring the eventual transition to a lower carbon world. No one knows how fast this transition will occur. But one thing is all but certain: electricity will be at the heart of the shift with power demand increasing in transportation, industry and the services sector as oil is displaced.

If you want to invest in oil stocks, I would completely avoid the U.S. majors and stick with the European majors where management seems more willing to diversify. As Mr. Wetselaar of Shell was quoted by the Financial Times, “Electrification… is going to be the story of the next decades. We want to not just be part of it; we want to become a leader.”

Buffett just went all-in on THIS new asset. Will you?
Buffett could see this new asset run 2,524% in 2018. And he's not the only one... Mark Cuban says "it's the most exciting thing I've ever seen." Mark Zuckerberg threw down $19 billion to get a piece... Bill Gates wagered $26 billion trying to control it...
What is it?
It's not gold, crypto or any mainstream investment. But these mega-billionaires have bet the farm it's about to be the most valuable asset on Earth. Wall Street and the financial media have no clue what's about to happen...And if you act fast, you could earn as much as 2,524% before the year is up.
Click here to find out what it is.

Source: Investors Alley