3 stocks you shouldn't overlook: the future of technology
For investors looking for promising stocks, one option is to turn to the analysis of reputable Wall Street analysts who can provide valuable insights on stocks with solid balance sheets and strong growth prospects.
In the following article, we look at three stocks recommended by the most experienced analysts, according to TipRanks, a platform that rates analysts based on their historical performance.
Micron Technology $MU
Micron Technology is a major player in chip manufacturing, especially memory modules. In the most recent quarter, the company beat analyst expectations in both revenue and earnings, which it attributes to growing demand for artificial intelligence (AI)-related technologies. Management predicts the company will achieve record revenue in 2025, supported by the expected growth of AI.
Goldman Sachs analyst Toshiya Hari reiterated a "buy" recommendation on MU stock and raised his target price from $138 to $158. Hari points to the stock's post-earnings decline, which he sees as a good opportunity for investors. He expects AI-driven demand and effective supply management to lead to better-than-expected earnings in 2025. Key factors for his optimistic forecast include gains in the high-performance memory market and AI growth in Micron's data centers.
Another positive factor is that Micron reported free cash flow of $425 million in the third quarter, marking a turnaround after several quarters of negative cash flow. Hari believes that despite the planned increase in capital expenditures, the company will remain able to generate positive cash flow.
Amazon $AMZN
The second stock on the list is Amazon, the e-commerce and cloud services giant that continues to dominate U.S. online retail. Recently, Evercore ISI analyst Mark Mahaney reiterated a "buy" recommendation on the stock with a $225 price target based on the results of his 12th annual online retail survey of 1,100 respondents.
Mahaney notes that Amazon excels in key areas such as price, selection and convenience. Although competitors, particularly Walmart, are showing improvement in these metrics, Amazon remains three to four times ahead of its rivals in all three areas. The survey also found that customer satisfaction with Amazon has risen to 84%, a significant improvement from 65% in 2020.
Mahaney also identifies three main factors that will support the company's growth in 2024: accelerated growth in Amazon Web Services, increasing margins in the North American retail sector, and solid free cash flow margins. These factors, along with continued improvements in the customer experience, reinforce Amazon's position as the "number one" large-cap stock.
Twilio $TWLO
The last stock on the list is Twilio, a cloud communications platform that has seen its number of active customers grow to more than 313,000. The company recently reported results that beat analysts' expectations, but the stock fell after the results were released due to a weak second-quarter forecast that reflected lower customer spending.
Ivan Feinseth of Tigress Financial recently initiated coverage on TWLO stock with a "buy" recommendation and a $75 price target. Feinseth sees the stock's decline as an opportunity for investors and believes Twilio is well positioned to take advantage of the growing demand for AI-driven automated customer services. He expects the company's investment in research and development and the integration of generative AI into new products will drive adoption among customers.
Feinseth also highlights Twilio's position as a leader in "call centers as a service" and expects the company's cost-saving and efficiency efforts to drive margins and profitability. While the stock is currently trading under pressure, the long-term growth potential in cloud communications and AI remains a strong argument for investors.
Disclaimer: There is plenty of inspiration to be found on Bulios, but stock selection and portfolio construction is entirely up to you, so always conduct thorough self-analysis.
Source: CNBC