These are some of the most recent stocks to receive a buy recommendation from CFRA Research.
These stocks are recommended by analysts for January.
The S&P 500 fell more than 5% in December, finishing 2022 down 19.4%, its lowest year since 2008. The Federal Reserve hiked interest rates by 0.5% in December as it battled inflation. As interest rates rise, it becomes more difficult for S&P 500 corporations to increase earnings. Indeed, many analysts now believe a recession is imminent. Fortunately, economists think the market’s tumultuous macroeconomic climate has spawned a slew of new investing opportunities. According to CFRA, here are nine recently upgraded stocks to purchase.
FactSet Research Systems Inc.
FactSet Research Systems delivers economic data and software solutions to the worldwide financial sector. Analyst Alexander Yokum upgraded FactSet, citing the company’s long track record of successfully handling economic downturns in the United States. FactSet’s revenue has increased for 42 consecutive years, and its net income has increased for 26 consecutive years, indicating the significance of its steady, dependable business. Furthermore, Yokum claims that more than 98% of FactSet’s business is recurring, and he anticipates 14% revenue growth in fiscal 2023. FDS stock, which ended at $401.21 on December 30, has a “buy” rating and a $470 price objective from CFRA.
Advance Auto Parts Inc.
Advance Auto Parts is one of the largest auto parts retailers in the United States. Analyst Garrett Nelson upgraded Advance and believes the company is undervalued in an environment when inflation appears to be slowing. Given the quantity of higher-maintenance used automobiles now on the road, Nelson is positive about aftermarket auto parts dealers in the medium term. Furthermore, he believes the stock’s dividend and buybacks are a huge plus for income investors. Nelson expects revenue growth to increase from 1% in 2022 to 4% in 2023. AAP stock, which ended at $147.03 on December 30, has a “buy” rating and a $185 price target from CFRA.
New Oriental Education & Technology Group Inc.
New Oriental Education & Technology is a leading for-profit education company in China, providing K-12 after-school tutoring services. After Chinese officials specifically prohibited for-profit private tutoring in July 2021, the stock has dropped 71% in the last three years. Analyst Aaron Ho raised New Oriental’s shares after a bad few years, saying the company’s digital education services and net cash position will enable it retain both regulatory compliance and profitability. According to Ho, the need for after-school tutoring in China will stay high. EDU stock, which ended at $34.82 on December 30, has a “buy” rating and a $35 price objective from CFRA.
Berry Global Group Inc. (BERY)
Berry Global manufactures rigid, flexible, and nonwoven packaging for a wide range of consumer and industrial applications. Berry has been upgraded by analyst Matthew Miller, who believes the company’s excellent balance sheet, reasonable valuation, and substantial free cash flow make it an appealing long-term investment. Miller expects a 13% free cash flow yield in fiscal 2023 and revenue growth to return from a 1.3% fall in fiscal 2023 to a 3% gain in fiscal 2024. Berry’s packaging products are linked to nondiscretionary products to the tune of 70%, making the company recession-resistant. BERY stock, which ended at $60.43 on December 30, has a “buy” rating with a price target of $68 from CFRA.
Tencent Music Entertainment Group (TME)
Tencent Music Entertainment, the parent company of QQ Music, Kugou Music, Kuwo Music, and WeSing, is a significant online music-streaming platform in China. Analyst Ahmad Halim raised the stock, predicting that income from online music services will likely recover in the next quarters, enhancing margins. Competition from NetEase, Cloud Music, Douyin, and other services will remain a headwind, but Halim is optimistic about the company’s long-term profit prospects given its advertising revenue opportunities. He believes that the company’s new content investments would eventually pay off. TME stock, which ended at $8.28 on December 30, has a “buy” rating and a $6.50 price objective from CFRA.
WestRock Co. (WRK)
WestRock is one of the leading corrugated-packaging companies in the United States. Analyst Matthew Miller upgraded the stock, citing WestRock’s strong free cash flow and appealing value. Unfortunately, Miller believes that the company will encounter relatively poor demand in the short term, which would weigh on sales growth. Despite obstacles from harsh comparisons, a gloomy economic forecast, and high customer inventory levels, WestRock has dramatically decreased its net debt since its 2019 Kapstone purchase, and Miller believes the firm will still grow revenue by 1% in fiscal 2023. CFRA rates WRK stock as a “buy” with a price objective of $45 after it closed at $35.16 on December 30.
CNH Industrial NV (CNHI)
CNH Industrial is a multinational manufacturer of agricultural and construction machines. Analyst Alan Lim Seong Chun raised his rating on CNH, citing the company’s growing margins and steady earnings in a difficult inflationary environment as signs of a stable long-term business outlook. Chun believes that the long-term expansion in global food consumption bodes well for CNH’s agricultural-segment sales, which include tractors and other farm equipment. Chun anticipates a 3% increase in revenue in 2023 and says the company is committed to shareholder returns, including $76 million in quarterly buybacks. CNHI stock, which ended at $16.06 on December 30, has a “buy” rating and a $17 price target from CFRA.
Hyatt Hotels Corp. (H)
Hyatt Hotels is a multinational hotel operator and owner. Analyst Siye Desta upgraded the company, stating that Hyatt shares are well priced in comparison to peers and should profit from healthy travel demand in 2023. Desta is optimistic about Hyatt’s unit growth forecast, predicting strong demand from higher-income consumers as well as an increase in group and business travel. Furthermore, Desta claims that Hyatt has a robust balance sheet. Hyatt reported 111.6% sales increase in the most recent quarter, while Desta forecasts 90% revenue growth for the full year 2022. H shares, which ended at $90.45 on December 30, has a “buy” rating and a $107 price objective from CFRA.
Exact Sciences Corp. (EXAS)
Exact Sciences is a pioneer in cancer screening and diagnostics, well known for its Cologuard colorectal cancer test. Analyst Ana Garcia raised the stock and believes that innovators may underestimate Exact’s Cologuard sales forecast. Garcia describes rival blood-based liquid biopsy assays as a “second-line diagnostic tool.” Following Exact’s acquisition of Thrive in 2021, Garcia believes Exact will be able to expand beyond Cologuard and become a market leader in liquid biopsy. She expects Cologuard testing to be a key growth driver in the future years. EXAS stock, which ended at $49.51 on December 30, has a “strong buy” rating and a $60 price objective from CFRA.
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