CoinDesk Report:
Investors are grappling with a mixed bag of signals as recent data suggests the economy may be softening even as the S&P 500 Index surges to new highs. Navigating this complex environment, investors may turn to top Wall Street analysts’ research to seek stocks with robust balance sheets and solid growth prospects. With this in mind, according to TipRanks data, here are three stocks favored by top professionals on Wall Street, ranked based on analysts’ historical performance.
Micron Technology
Micron Technology (MU), a chip manufacturer, stands out as this week’s top pick. The company recently reported growth in revenue and profit for the third quarter, driven by sustained demand from the artificial intelligence wave. Management is confident about the future path and anticipates record revenues in fiscal year 2025, supported by opportunities in AI-driven initiatives. Reflecting on these results, Goldman Sachs analyst Toshiya Hari reiterated a Buy rating on MU stock, raising the target price from $138 to $158. Hari views the recent pullback in earnings as a favorable entry point for investors and expects earnings growth in 2025 to exceed consensus, driven by AI-driven demand and tight supply dynamics. He highlights reasons for his optimistic investment thesis, including market share gains in lucrative high-bandwidth memory spaces and growth in Micron’s data center and edge computing AI segments. Hari notes Micron generated $425 million in free cash flow during Q3, marking a rebound from several quarters of negative FCF. He adds the company “remains committed to driving positive cash flow in Q4 and fiscal 2025, even with anticipated significant capital expenditures.”
Among over 8,900 analysts tracked by TipRanks, Hari ranks 25th, with a success rate of 69% and an average return of 29.2%.
Amazon
Turning to e-commerce and cloud computing giant Amazon (AMZN), Evercore ISI analyst Mark Mahaney reiterated a Buy rating on AMZN stock with a target price of $225. Recently, the company conducted its 12th annual U.S. online retail survey involving 1,100 respondents. Mahaney highlighted Amazon’s continued dominance in the U.S. online retail sector, evident across three key shopping metrics tracked by the company—price, selection, and convenience. However, he cautioned that the competitive landscape for Amazon’s retail business remains mixed, particularly with Walmart showing significant improvements in selection and convenience metrics. Mahaney noted Amazon still leads its closest competitors by three to four times across all three critical metrics. Additionally, customer satisfaction continues to improve, rising 2% year-over-year to 84%, a significant jump from 65% in 2020. The analyst believes the score improvement “reflects Amazon’s ongoing focus on improving speed and selection (especially through regional initiatives).” Mahaney also pointed out that Amazon Prime reached a historical high penetration rate of 81%. Features like Prime Video, free same-day delivery, Prime Music, and Grocery enhance the attractiveness of Prime membership to survey respondents. Overall, Amazon remains Evercore’s “top large-cap long,” with survey results supporting the company’s long-term investment thesis.
Mahaney ranks 20th among over 8,900 analysts tracked by TipRanks, with a success rate of 63% and an average return of 32.2%.
Twilio
Cloud communications platform Twilio (TWLO) is the third pick this week. The company reported better-than-expected performance for Q1 2024, with active customer accounts increasing to over 313,000 as of March 31 from the previous quarter’s end of 300,000. However, softer-than-expected guidance for Q2 reflected the impact of tepid customer spending, causing the stock price to decline post-earnings. Nonetheless, Tigress Financial analyst Ivan Feinseth recently initiated coverage on TWLO stock with a Buy rating and a target price of $75. Feinseth sees the sell-off as an attractive buying opportunity, believing “TWLO is well-positioned to benefit from the continued acceleration in AI-driven digital customer engagement.” He expects Twilio to capitalize on demand for AI-based automated responses to ensure timely and cost-efficient customer interactions. He forecasts the company will continue to invest in R&D, integrating predictive and generative AI into new products to enhance customer adoption. Feinseth also highlighted Twilio’s advanced “Contact Center as a Service” platform and its industry-leading position in the communication market. He anticipates cost-saving measures and efficiency initiatives will improve profitability and earnings potential.
Feinseth ranks 195th among over 8,900 analysts tracked by TipRanks, with a success rate of 61% and an average return of 13.1%.
