Navigate the stock market’s challenges by targeting stocks with price target hikes
It’s tough to puff your chest out and invest in the stock market lately. The stock market has slowed down in the past month, delivering negative returns. The escalating situation in the Middle East and a disappointing inflation report are among the main factors dragging down the market. In such a scenario, investors must focus on stocks with price target hikes.
Betting on stocks recently receiving price target hikes from top analysts can be incredibly advantageous. Such endorsements usually mean that analysts foresee positive momentum or uncover value that has been overlooked by the market. Analysts’ revisions often result from encouraging fundamentals, potential market expansion, or improved financial outlooks. Such is the case with these three analyst-endorsed stocks offering stellar upside ahead.
Arcadium Lithium (ALTM)
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Previous Rating: ‘Buy’
New Rating: ‘Strong Buy’
Arcadium Lithium (NYSE:ALTM), emerging from the merger of Allkem and Livent, is a leading lithium player. It stands out as a juggernaut in its niche, combining Livent’s advanced processing technologies and Allkem’s robust growth pipeline.
However, ALTM stock is down over 30% since the start of the year, with lithium prices tanking. Nevertheless, its financials project a story of resilience and growth. Revenue shot up to $882.5 million in 2023 from $813.2 million last year. Moreover, net income increased to $330.1 million, considerably higher than last year’s $273.5 million.
ALMT is setting the stage for substantial long-term growth as we advance, targeting a 40% jump in lithium hydroxide and carbonate production. Furthermore, its financial projections are optimistic, with anticipated sales between $1,250 million and $1,900 million and adjusted EBITDA ranging from $420 million to $1 billion, depending on lithium market prices. Despite the positives, ALTM stock trades under four times trailing twelve-month (TTM) non-GAAP earnings, 75% lower than the sector median.
TKO Group (TKO)
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Previous Rating: ‘Buy’
New Rating: ‘Strong buy’
TKO Group (NYSE:TKO) has been arguably the most talked-about entertainment stock in the past few weeks following the monstrous success of WWE’s WrestleMania XL event. The latest incarnation of WWE’s annual showcase event was the most successful in the company’s history, shattering records for gate, viewership, and merchandise. Consequently, TKO stock is up an impressive 22% for the month.
TKO shines as an investment, effectively blending the UFC’s dynamic appeal with the WWE’s global reach. This merger combines two of the biggest entertainment intellectual properties, accessing over a billion households globally. The combined entity is set to continue reaping the benefits of its diverse revenue streams, which include media rights, event ticketing, and branded merchandise. Moreover, it has opened up new revenue streams with investments in online betting, enhancing its market position and prospects for significant long-term expansion and positioning it as a powerhouse in the global entertainment landscape.
Diamondback Energy (FANG)
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Previous Rating: ‘Buy’
New Rating: ‘Strong buy’
Diamondback Energy (NASDAQ:FANG) has been in the news in the past few months due to its $26 billion acquisition of Endeavor Energy Partners. The analyst-endorsed merger will strengthen Diamondback’s stronghold in the oil-rich Permian Basin. Moreover, the merger further solidifies Diamondback’s presence in a key U.S. energy hub while capitalizing on the ongoing consolidation trend in the sector. To put things in perspective, FANG stock is up 35% year-to-date (YTD), trouncing the S&P 500’s 8% gain.
Moreover, FANG stock will continue climbing and is positioned for more upside ahead, with production boosts at its existing sites hinting at more potential ahead. Stellar production led to solid operating results in the fourth quarter (Q4). Its strong production helped effectively offset the drop in prices, as its unhedged realized price for oil decreased roughly 5% to $76.42/bbl from $80.37/bbl in the prior-year quarter. Moreover, with Brent futures for June delivery at $89.64, expect strong gains in the upcoming quarter, boosting its top-and-bottom-line results.
On the date of publication, Muslim Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
