Stock Groups

Top Wall Street analysts say buy Apple & Netflix

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On the New York Stock Exchange’s facade, you can see the Spotify logo. It is adorned with the U.S. flag. The company has listed its stock through a direct New York listing on April 3, 2018.

Lucas Jackson | Reuters

As investors digested plans by the Federal Reserve to tighten their monetary policies, stocks were volatile over the week.

The near-term outlook for investing is uncertain as investors consider the risks of recession, disruptions to supply chains and conflict in Eastern Europe. The Fed also revealed its plans in the March minutes of the meeting. This week’s announcement also sheds more light on the future direction of the central bank. shrink its balance sheet.

Wall Street’s best pros put aside stock-market volatility. TipRanks tracks the top-performing analysts and has determined that Wall Street’s most successful pros have chosen companies with the greatest long-term potential.

These are the names you should be paying attention to this week.

Disney  

Disney (DIS(Recently experienced) a massive rebound in revenuesAs the pandemic waned, so did its attraction parks.  

Ivan FeinsethTigress Financial Partners remains positive about Disney’s prospects, noting that they managed to make 100% year-overyear revenue gains from their theme parks. (See Walt Disney Company Stock ChartsTipRanks 

Feinseth considered the stock to be a buy and gave a target price of $229 per share.  

The entertainment company has also been producing popular content for both its film franchises as well as its streaming platform, Disney+.  

Top-ranking analyst wrote that Content is King and DIS is The King of Content. She argued that DIS has “strong brand equity”, innovative entertainment development abilities, ongoing investments in new media development initiatives, and will continue driving gains for entertainment company.  

While DisneyFeinseth believes that these activities will resume soon after having previously stopped share repurchases and dividend payments to avoid uncertain, pandemic-induced economic fluctuations.  

TipRanks currently has nearly 8,000 analysts and Feinseth ranks as the No. 67. He was correct in picking stocks 68% of time and has averaged 30.8% for each of his ratings.  

Apple 

AppleAAPL() continues to innovate on many fronts. One is the company’s expanding payments business. It operates Apple Pay and has been speculated that they may be aiming to chartered banks. Amit DaryananiEvercore ISI isn’t expecting this. Apple’The current course is much more advantageous.  

Daryanani argued AAPL will continue to scale its fintech section and concentrate its efforts in building a closed loop payments system. The tech company prefers to grow its consumer penetration, and stickiness in its ecosystem over intense regulatory oversight that comes with getting a bank charter. (See Apple Hedge Fund Activity on TipRanks) 

The analyst rated the stock a buy, and he calculated a price target of $210.  

Apple recently acquired British fintech firm Credit Kudos, a move which Daryanani believes enhances its open-banking infrastructure capacities. Moreover, Apple and Goldman Sachs (GS) are reportedly working together to bring “buy now, pay later” services to the tech giant’s users. The project, dubbed Apple Pay Later, is yet another piece of the financial puzzle which AAPL is creating.  

Daryanani went on to add that Apple is moving several other tools in house, including “payment processing, risk assessment for lending, fraud analysis, credit checks and additional customer-service functions such as the handling of disputes.”  

Out of nearly 8,000 analysts, Daryanani maintains a position of No. 161. His success rate stands at 68%, and he has averaged returns of 29.7% on each of his stock picks.  

Zscaler  

Cybersecurity is an industry with huge potential, and Zscaler (ZS) may be a choice that can continue to beat analysts’ estimates and raise its guidance.  

This is at least in accordance with the opinions of Alex Henderson of Needham, who expects the firm to “drive robust growth, improving margins, and ultimately facilitate a changing architecture for Enterprises to a Cloud Direct model.” The analyst went to say that while near-term consolidation in the stock’s valuation may be possible, the company itself has “exceptional long-term value.”  

Henderson rated the stock a buy and assigned a price target of $418.  

The analyst specified the company’s history of strong operating margins, and he anticipates ZS to maintain a 20% to 30% rate of that metric for a prolonged period. (See Zscaler Earnings DataTipRanks 

Henderson highlighted several nascent products driving growth, including Zscaler Cloud Protection and Zscaler Digital Experience, which are enhancing user experiences and complement its older Zscaler Internet Access and Zscaler Private Access offerings.  

Henderson called the company “one of the top growth names in our coverage” and said that investors should buy shares and “add on any weakness.”  

Out of almost 8,000 analysts in TipRanks’ database, Henderson maintains a rank of No. 43. When picking stocks, he has been correct 71% of the time, and he has an aggregated average return rate of 39.3% per rating.  

Spotify  

Grabbing shares when they’re down is easy, but finding the stock with the potential to rebound is where investors get tripped up. In the case of Spotify (SPOT), the stock has been weighed down by not only the fourth quarter’s tech and growth sell-offs, but also by investor worries over the streaming company’s actual business model.  

The firm has yet to prove its ability to generate dominating gross margins, although one analyst believes the answer lies within a key feature of Spotify’s services: its two-sided marketplace.

In his recent bullish report, Mark Mahaney of Evercore ISI asserted that Spotify is reaching an inflection point. (See Spotify Risk AnalysisTipRanks 

Mahaney rated the stock a Buy, and offered a price target of $300 per share.  

The two-sided marketplace, which Spotify calls its “paid promotional tools it offers to artists and labels,” is essentially a content-boosting option that integrates into algorithmic playlists and pop ups on users’ accounts. These tools have shown success, and Mahaney believes they can add substantially to the music streaming service’s margins over the next two years.  

He believes that the tools could triple their current contribution, reaching 30% or more of SPOT’s gross margins by 2024, and representing about 15% to 20% of the total industry marketing spend. This would be a year ahead of Wall Street’s consensus on the matter, and it would result in a “material re-rating in SPOT shares,” undoubtedly boosting valuation, the analyst noted. 

Mahaney is ranked at No. 372, out of almost 8,000 professional analysts on TipRanks. He has found success when rating stocks 55% of the time, and he has returned an average of 25.3% on each.  

Netflix

Due in part to increasing competition in the industry, Netflix (NFLX) has recently seen investors fleeing its shares, causing a significant sell-off from its 2021 highs. The streaming platform still holds a considerable market share, although one analyst sees a high potential for further subscriber penetration.  

That hypothesis comes from Doug Anmuth of JPMorgan, who analyzed the company’s global subscriber penetration and found several large markets which can see growth moving forward. According to Anmuth’s calculations, Netflix currently holds about a third of all global broadband subscribers, and far less in regions like Asia-Pacific and Europe, the Middle East and Africa. (See Netflix Website TrafficTipRanks 

Anmuth considered the stock to be a buy and gave a target price of $605. The stock would be closer to 2021’s value if this target was met.  

The analyst said that “Within EMEA, we view pockets of Eastern and Southern Europe, as well as the Middle East & Africa as largely under penetrated, & Japan, India, & South Korea as Key growth opportunities in APAC.” Anmuth stated that APAC is the largest and fastest-growing market. However, Anmuth thinks APAC will focus on localized content.  

Analyst John Davidson stated his bullish outlook on the firm when he discussed the fact that NFLX was a major beneficiary and driver in the ongoing disruption to linear television. He said: “We believe NFLX, with its content performing well internationally, is driving strong subscriber and revenue growth, as well as a virtuous loop of increasing profit.”  

Anmuth is the No. 1 analyst out of almost 8,000. 227. He is correct 58% of time with his stock picks and has earned an average of 28.6% per each one. 

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