In the face of ongoing discussions about the Federal Reserve’s interest rate plans and the buzz around artificial intelligence, the American stock market is experiencing significant influence. Additionally, the uncertainty around the economic trajectory plays a role in shaping the mood among investors.
In this uncertain environment, Wall Street’s preeminent analysts are zeroing in on stocks that exhibit robust foundational metrics and show promise for sustained growth. For investors mapping out their strategies, the insights from these top analysts are invaluable resources.
Considering the present circumstances, let’s examine three stocks that have garnered favorable reviews from Wall Street’s most recognized experts, as reported by TipRanks, an analytics service that evaluates analysts based on their historical accuracy and performance.
Delta Air Lines
First on our list is Delta Air Lines (DAL), the industry giant and America’s number two airline. Offering more than 4,000 daily departures to over 290 destinations across six continents, DAL’s expansive operations were highlighted at the Toronto Corporate Access Day recently hosted by TD Cowen. Analyst Helane Becker gave DAL a thumbs up with a ‘buy’ status and a projected target of $55.
Becker champions Delta as TD Cowen’s top pick for 2021 and commends how Delta is investing in its services, but what really shines is their long-term vision. “Delta has a strategic plan that they have been executing for the last 15 years with success,” she asserts.
According to Becker, DAL’s consistency in management and strategy set it apart from competitors, often signaling a more compelling investment. She extols Delta’s robust route network, collaborative partnerships with fellow carriers, and notable operational dependability — demonstrated by increased customer loyalty over the past decade.
Becker also pointed to Delta’s earnings commentary acknowledging a robust rise in premium customer demand and a noteworthy rebound in business travel, rising by significant margins compared to the previous year. Additionally, Delta’s ongoing debt reduction efforts are fortifying its financial position.
Becker holds the rank of No. 276 among over 8,800 analysts monitored by TipRanks. Her predictions have realized profits 63% of the time, averaging a return of 11.2%. (View Delta Air Lines Stock Charts on TipRanks)
Microsoft
Moving on, we pivot to the software behemoth Microsoft (MSFT). As a major investor in OpenAI, the creators of ChatGPT, Microsoft is expected to be at the forefront of the burgeoning generative AI (artificial intelligence) sector.
Ivan Feinseth of Tigress Financial recently reiterated his ‘buy’ stance on MSFT, boosting his price estimate from $475 to $550. He cites Microsoft’s prime positioning to dominate the AI landscape, particularly with its commitment to integrating generative AI features into its extensive software ecosystem and range of products.
Feinseth points out that the company’s impressive revenue growth of 17% in the fiscal third quarter was propelled by the swift adoption of AI-driven services and AI cloud offerings. Microsoft’s cloud division, especially the Azure platform, has enjoyed a surge in demand, boding well for the company’s overall performance.
Furthermore, Microsoft’s growing foothold in the gaming sector and its ventures into the Metaverse offer additional avenues for growth. Particularly, the gaming segment is slated to gain from the Activision Blizzard acquisition worth $75 billion and the debut of the latest Xbox console.
Feinseth also underlines Microsoft’s robust financial health, which lends itself to improved rewards for shareholders and supports sustained investment in AI development.
Feinseth is ranked at No. 242 out of over 8,800 analysts rated by TipRanks, with a solid 60% success rate and an average profit of 12.2%. (Analyze Microsoft Technical Analysis on TipRanks)
Zscaler
The final selection for this week’s lineup is Zscaler (ZS), a dominant force in cloud-based cyber security. Providing the Zscaler Zero Trust Exchange, the company ensures secure connections between users, devices, and applications by neutralizing cyber threats and data breaches.
In the wake of Zenith Live 2024, Baird’s analyst Shrenik Kothari upheld a ‘buy’ standing on Zscaler shares, targeting a $260 price point. Reflecting on the event’s highlights, Kothari remarks on Zscaler’s ambition to pursue additional market segments through expansion of its core platform.
Kothari particularizes on Zscaler’s premiere of Zscaler Identity Protection, which leverages advanced machine learning for heightened security across cloud operations, as well as the introduction of Cloud Browser Isolation, which protects user endpoints, and the AI-equipped DLP 2.0 solution, designed to safeguard sensitive data.
With these innovations, Zscaler’s market potential has dramatically increased, with Kothari noting an expansion of over $24 billion, broadening their total addressable market to $96 billion. He further Highlights Zscaler’s tactic shift in sales from transactional to client-centric, which aims to boost the clientele within the $10 million annual recurring revenue bracket.
“The company’s success narratives, particularly in high-stakes sectors like finance, healthcare, and manufacturing, reaffirm Zscaler’s competence in providing security solutions at scale,” Kothari observes.
Among TipRanks’ pool of over 8,800 analysts, Kothari is positioned at No. 381, with his guidance proving profitable 66% of the time and yielding an average return of 20.6%. (Refer to Zscaler Financial Statements on TipRanks)
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