Which top stocks are Wall Street analysts the most bullish on? Stocks with no “hold” or “sell” ratings and a pure “Strong Buy” analyst consensus. These are the stocks that make the most compelling investing opportunities and are definitely worth keeping a close eye on.
Using TipRanks powerful stock screener, I set out to pinpoint seven stocks that command the unanimous support of the Street. You can customize the screener settings to match your investment strategy. In this case, I selected filters for stocks of all market cap size with a “Strong Buy” consensus from analysts and best-performing analysts alike. These are the top analysts with the highest success rate and average return.
Here I specifically select stocks with big upside potential from the current share price. This is based on the upside potential from the current share price to the average analyst price target.
Now let’s delve into these seven top stocks to buy now:
Stocks to Buy With 100% Street Support: Alibaba (BABA)
Does Alibaba Group Holding Ltd (NYSE:BABA) ever disappoint? With 11 back-to-back analyst ‘buy’ ratings and an average price target of $247 (27% upside potential) it looks like the answer is a resounding no. On May 18 top-rated MKM Partners’ analyst Rob Sanderson has just ramped up his price target from $260 to $280. He is now predicting big upside potential of 44% from the current share price. Bear in mind that last year share prices exploded over 60%.
Sanderson is feeling the heat following the company’s “strong quarter and encouraging outlook”. Most notably he believes “the narrative on the stock is shifting from concern over investment spending to a focus on profit growth and long-term opportunity.” For Sanderson the company’s big spending projects (think the Cainiao logistics platform, Lazada in Southeast Asia, and food delivery platform Ele.me), are “absolutely” worthwhile.
And don’t forget Alibaba’s new retail strategy. The company’s goal to mix online and offline retail is changing the face of retail in China. For example, smart pop-up stores are connected to BABA’s Alipay online payment system while facial recognition technology is used to track customers. According to Sanderson: “We think this business will ultimately be as high a margin, or better than the existing marketplace model.”
Stocks to Buy With 100% Street Support: Electronic Arts (EA)
‘An embarrassment of riches.’ This is how Wedbush analyst Michael Pachter describes the fiscal Q4 results from video game giant Electronic Arts Inc. (NASDAQ:EA). Even though Epic’s Fortnite is the hottest game on the internet, nothing can stop EA’s soaring success right now.
Top Jefferies analyst Timothy O’Shea puts his spin on the results here: “EA is now the third straight US video game publisher to post strong results despite Fortnite being the hottest game in years, suggesting Fortnite is more about expanding the market than cannibalizing it.” He has a $150 price target on EA (14% upside potential).
Specifically, EPS of $1.28 was well ahead of $1.16 consensus and full year guide of $4.85 seems conservative. At the same time, EA announced a huge new buyback of $2.4 billion over 2 years, double the current buyback. And looking forward, O’Shea is confident that “The F’19 setup seems very strong with the release slate anchored by FIFA and Battlefield, EA’s two biggest franchises.”
Clearly the Street is in one mind here. In the last three months, EA has received 10 consecutive ‘buy’ ratings. This comes with a $146 price target (11% upside potential).
Stocks to Buy With 100% Street Support: American Tower Corp (AMT)
American Tower Corp (NYSE:AMT) is capitalizing on the robust demand for telecommunications tower space. The company operates towers and distributed antenna systems in the US, Mexico, Brazil and India. “The strong demand we experienced in late 2017 for our telecommunications real estate further accelerated in 1Q 2018” commented CEO James Taiclet in the company’s recent earnings call.
And the future is just as bright: “We remain confident that our U.S. macro tower business, complemented by our franchise small cell installations, extensive international portfolio and innovation initiatives will continue to drive strong growth and attractive total returns for many years to come.”
The Street agrees — 5 analysts have published recent AMT buy ratings. One of these is top-rated Oppenheimer analyst Timothy Horan. In the next two years, 4G advanced LTE is likely to be aggressively deployed to support massive wireless data growth. This drives demand for tower leases, which have pricing power on limited supply. Consequently, Horan is expecting double-digit revenue growth for AMT with a 15% free cash flow growth. Bear in mind AMT already “has the strongest balance sheet in the group.”
Our data shows that the average analyst price target of $158 indicates 15% upside potential.
Stocks to Buy With 100% Street Support: uniQure NV (QURE)
Dutch biotech company uniQure N.V. (NASDAQ:QURE) is staging a comeback right now. And what a comeback! The creator of the world’s first gene editing therapy, QURE is now focusing on treating haemophilia. This bleeding disorder represents a much larger market opportunity than its previous drug Glybera.
UniQure plans to kick-off a late-stage study of its hemophilia therapy, AMT-061, in Q3. The goal is to beat larger rivals Spark Therapeutics Inc (NASDAQ:ONCE) and Pfizer Inc. (NYSE:PFE) with a 2020 launch. Luckily HC Wainwright analyst Debjit Chattopadhyay calculates that “Pfizer might be in a position to initiate patient screening during 1Q19, which puts uniQure at least six months ahead and armed with the patent family covering mPADUA, which gives uniQure significant commercial leverage, in our view.”
Meanwhile, in a very bullish move, top Leerink Swann analyst Joseph Schwartz ramped up his price target from $26 to $63 (107% upside potential). According to Schwartz, this is based on the eyebrow-raising pricing estimates for AMT-061 of $1.5 million per patient in the U.S. and $1 million per patient in the EU.
Plus uniQure is increasingly looking like a prime takeover target for larger biotechs with an eye on the potentially very lucrative gene therapy space. Overall we can see that QURE has received six recent ‘buy ratings’. Their average price target of $45 indicates 44% upside potential.
Stocks to Buy With 100% Street Support: Equinix (EQIX)
This internet-connection specialist is certainly worth checking out. With four recent analyst ‘buy’ ratings and big upside potential of 37%, this stock is going places. Equinix Inc (NASDAQ:EQIX) has just announced new expansions in Amsterdam, Tokyo and Zurich to meet strong momentum in Europe and Asia-Pacific. It is now the market leader in 16 of the 24 countries in which it operates.
This comes on the back of a solid first quarter. Oppenheimer analyst Timothy Horan points out that “bookings remained very strong according to Equinix.” But ultimately the bottom line is that “EQIX is seeing strong demand from enterprises adopting hybrid cloud strategies; its datacenters are the key interconnection point between on-premise and the cloud.” He has just reiterated his ‘buy’ rating with a $525 price target (36% upside potential).
Note that this Top 50-ranked analyst tends to be on the money when it comes to stock picking. On EQIX specifically he is currently tracking a 78% success rate and 17% average return.
Stocks to Buy With 100% Street Support: FedEx (FDX)
Delivery giant FedEx Corporation (NYSE:FDX) is firing on all cylinders. The company boasts the leading market share in both “express” U.S. parcel delivery and a strong position in its expanding FedEx Ground segment. Luckily for FedEX, both these segments are quickly gaining ground via e-commerce volume.
Top Oppenheimer analyst Scott Schneeberger has just attended a FedEX investor meeting. He notes: “FedEx is clearly upbeat on business conditions across its segments.” In particular, “F3Q18 total revenue growth accelerated to the double-digits y/y, which we anticipate to perpetuate in F4Q18.”
All this leads him to his bullish conclusion: “Anticipating continued US/global economic growth, we expect overall margin expansion via mid-single digit top-line growth, efficiencies, and TNT synergies longer term.” FedEx acquired Netherlands-based TNT Express for a whopping $4.8 billion back in 2015. Although a massive cyberattack left a ‘lingering impact’ on TNT, ultimately favorable business conditions/effective execution mean that FedEx still sees a FY17-FY20 $1.2-1.5B Express operating income improvement.
Schneeberger has a $282 price target on FedEx — which translates into 13% upside potential. However, the Street is more bullish- the average analyst price target of $293 suggests 17% upside potential. In the last three months, nine analysts have published buy ratings on FedEx.
Stocks to Buy With 100% Street Support: Delta Airlines (DAL)
Are you ready to fly? It’s time for Delta Air Lines, Inc. (NYSE:DAL) stock to move higher. This is according to Morgan Stanley’s Rajeev Lalwani. He believes the stock is currently unfairly valued. Delta is trading at approx 8x 2019 consensus EPS, which is “just too low.” Instead Lalwani calls a valuation on 11x multiple on 2019 estimates “about right.” He has now pushed his price target from $66 to $72 (36% upside potential).
DAL deserves a higher valuation says Lalwani when you consider the following: a strong free-cash flow yield, “billions in capital returns, and an investment-grade balance sheet.” Most impressively, a free cash flow yield estimate of 10-12% in 2018 and 2019 is “well in excess” of peers.
Indeed, even with high oil prices, Delta still reported a strong first quarter. “Our economic outlook for the year is strong, both domestically and internationally,” CEO Edward Bastian said. “There is a resiliency we have created in our business structure that we have not seen over time.” In total, DAL scores 8 buy ratings with an average price target of $74. As shares are now at $53, this translates into big upside potential of 40%.
Source: Investor Place