The latest bout of market volatility has been nothing short of stomach-churning for short-term investors.
Indeed, a sell-off led by tech names and growth has spread into a malaise that's left the three major averages firmly in negative territory for January.
Analysts perform long-term projections of the companies they cover, which enables them to look past stocks' short-term gyrations. Indeed, some of Wall Street's top analysts have pointed out the names they like best for long-term plays, according to TipRanks, which tracks the best-performing stock pickers.
E-commerce trends have been cooling, and the shares of some players in the space have suffered. Shopify (SHOP) is no outlier, and has seen its valuation fall about 50% from its most recent peak in November. To many analysts, the discounted share price looks attractive on the merchant point-of-sale platform. (See Shopify Stock Charts on TipRanks)
One of these bullish voices is Darren Aftahi of Roth Capital Partners, who is projecting 30% year-over-year growth in gross merchandise value for SHOP's upcoming earnings. Calling the company a leader in e-commerce, he noted stabilizing consumer spending trends and the strong position Shopify holds within its space.
Aftahi rated the stock a Buy, and provided a price target of $1,400.
Most significantly, the analyst discussed Shopify's recent strategic partnership with Chinese e-commerce giant JD.com. The deal will allow SHOP merchants to "sell directly to Chinese customers through JD Marketplace," and is expected to open them up to "a new TAM of JD's ~500M+ active customers in China."
By streamlining the merchant barrier to entry into the Chinese market from 12 months to 3 to 4 weeks, Aftahi is confident the deal will add to Shopify's topline for the second half of 2022.
Financial aggregator TipRanks currently maintains Aftahi at a standing of No. 222 out of more than 7,000 analysts in its database. His success rate sits at 39%, and his ratings have returned him an average 40.7% per.
For Meta Platforms (FB), the last few months of 2021 were tumultuous: Untold amounts of negative headlines and insight from the whistleblower Frances Haugen and subsequent testimonies before lawmakers on Meta's algorithms spooked some investors.
Brian White of Monness predicts a no less turbulent year for Meta, which is expected to release quarterly earnings on Feb. 2. The technology conglomerate is also expected to "continue to benefit from the digital ad trend, participate in accelerated digital transformation, and innovate in the metaverse." (See Meta Platforms Website Traffic on TipRanks)
White rated the stock a Buy, and assigned a price target of $460.
The analyst noted that ad growth had slowed but still maintained a "respectable" pace of spending. Moreover, he does not anticipate that FB is out of the woods just yet in regard to its ongoing negative publicity. Its upcoming earnings call will likely also include hot topics like Apple's privacy policies, user engagement with Instagram Reels, and general e-commerce trends.
Despite these issues, White sees FB at an attractive discounted valuation, and remains bullish overall for its earnings call.
Out of over 7,000 analysts, White stands at No. 141. His stock picks have been correct 66% of the time and have returned him an average of 31.1%.
The pandemic surely caused a roller-coaster of emotions for investors holding Uber Technologies (UBER), but analysts have returned to their bullish expectations on the stock. At first, the omicron variant caused more panic and heightened restrictions on mobility, although it now appears that levels are returning to pre-pandemic numbers.
This situation was put best by Scott Devitt of Stifel, who argued that the global recovery in mobility is looking healthy and that the company expects to perform near the higher end of its guidance range. Uber is expected to release earnings Feb. 9 after the market closes and will hold an investor conference the following day. (See Uber Hedge Fund Activity on TipRanks)
Devitt assigned a Buy rating to the stock, and declared a price target of $50.
He went on to write that Uber has recently revamped its loyalty program, having introduced its Uber One membership service. The new iteration of its former Uber Eats Pass will connect users to benefits found across the companies various businesses, including its delivery, grocery, and rideshare apps. This move is anticipated to garner increased engagement within Uber's loyal base and is viewed by Devitt as "incrementally positive as it bolsters the value proposition over the prior offering."
Furthermore, Uber has been busy integrating its freight capabilities with the newly acquired Transplace, a logistics management software firm.
Of more than 7,000 financial analysts, Devitt is rated as No. 335. The analyst's stock picks have turned success 52% of the time and have returned him an average of 23.9% per.
Up until this past quarter, the Covid-19 pandemic had been good to HubSpot (HUBS). As soon as news of the omicron variant hit headlines, the stock began to plummet precipitously. Nevertheless, analysts appreciate the direction the marketing, sales, and enterprise management software company is taking. (See HubSpot Insider Trading Activity on TipRanks)
Samad Samana of Jefferies is one of those in the crowd, asserting that the stock "remains one of our favorite mid-cap names." He noted that the end of 2021 and first few weeks of 2022 provide promising projections for the year.
Samana rated the stock a Buy, and issued a price target of $800 per share.
The analyst wrote of a sustained and strong outlook of growth for HubSpot in 2022, due in part to its "enterprise traction and higher attach rates." The company has seen more larger enterprises adopting its software and sticking with it even after scaling upward themselves. In this sense, it is contending with established players such as Salesforce.
Samana said that "some large customers who previously migrated away from HUBS express interest in moving back onto HUBS due to the significant progress with the product suite and the ability to handle larger, more complex customers."
TipRanks holds Samana at No. 386 out of over 7,000 analysts. His stock picks have returned correctly 53% of the time and have averaged returns of 29.9%.
The pandemic-induced digital transformation caught up another cloud-based enterprise and work flow-solutions company and sent its valuation soaring. Like its peers, ServiceNow (NOW) also took a considerable tumble off early November highs, yet managed to release top-notch earnings for the fourth quarter. According to Brian Schwartz of Oppenheimer & Co., the stock has a possible recovery in its cards.
The analyst noted robust momentum in ServiceNow's business, fueled by demand for IT services. Regarding this demand, he was encouraged by NOW's earnings, writing that "these results should put to rest concerns that enterprise IT demand is somehow falling apart." (See ServiceNow Earnings Data on TipRanks)
Schwartz rated the stock a Buy, and calculated a price target of $660.
Investors should always be attentive when companies set guidance above Wall Street consensus estimates. ServiceNow did this despite its ongoing headwinds of the slowing macro environment over the last two months.
Additionally, Schwartz noted his bullishness despite the swings in share price, writing that "NOW offers a nice balance of strong top-line growth, margin expansion, and high cash-flow margins, such that even if valuation multiples were to compress further across the space, its unique financials profile and entrenchment across enterprise IT stacks position ServiceNow to outperform its growth peers."
He went on to say that ServiceNow "provides investors with a unique proposition among large-cap software stocks."
Out of over 7,000 professional analysts in TipRanks' database, Schwartz is ranked as No. 14. He has been successful in rating stocks 72% of the time, and his picks have returned him an average of 51.4%.