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Analysts Say These 3 Stocks Are Their Prime Picks for 2021
The yr is winding down, and it’s time for Wall Street’s analysts to begin flagging their prime picks for the approaching yr. It’s a time-honored custom, in most walks of life, to take a typically tongue-in-cheek have a look at what lies forward, and to begin giving recommendation on the say-so of a metaphorical crystal ball.Analysts have been analyzing every stock rigorously, taking a look at its previous and present efficiency, its tendencies on a wide range of time frames, administration’s plans – the analysts take the whole lot into consideration. Their suggestions present useful path for constructing a resilient portfolio within the new yr.As regular, TipRanks has collected and collated the info on the highest picks, and made it obtainable for buyers’ use. The stock selections, and their information, make for some fascinating selections. Let’s take a better look. UTZ Manufacturers (UTZ)UTZ Manufacturers is a well-recognized label within the japanese US. The corporate is thought for its vary of snack meals, of the salty selection moderately than candy. The corporate’s line of meals, together with pretzels, potato chips, snack mixes, and popcorn, are frequent selections in merchandising machines. In August, UTZ (then often called Utz High quality Meals) has accomplished a enterprise mixture settlement with Collier Creek, a particular goal acquisition firm. The mixture introduced the venerable snack firm into the general public buying and selling area. Extra lately, UTZ posted sturdy Q3 outcomes and reported that it has entered an settlement to purchase competing snack firm Truco. The quarterly outcomes had been launched first, on November 5, displaying $248 million in web gross sales, a year-over-year acquire of 24%, together with a 23% yoy acquire in gross revenue. One week later, UTZ and Truco introduced a $480 million acquisition settlement, which can deliver the ‘On the Border’ model of tortilla chips and salsas into UTZ product line.Overlaying this stock for Oppenheimer is 5-star analyst Rupesh Parikh, who sees a transparent path ahead for the corporate. “[Following] the company’s announcement on 11/12 to acquire Truco Enterprises, [we] overall look very favorably upon the deal economics, synergy opportunity, leverage to the attractive tortilla category including ancillary products (salsa and queso), and compelling growth prospects for the brand,” Parikh opined. “We believe the company is well positioned to drive at least 3-4% organic sales growth and 6-8% EBITDA growth with upside optionality from strategic acquisitions,” the analyst concluded. To this end, UTZ remains Parikh’s top small-cap food pick. The analyst rates the stock an Outperform (i.e. Buy) along with a $24 price target. This figure implies a 28% upside from current levels. (To watch Parikh’s track record, click here)Overall, Wall Street loves this stock, earning a stellar analyst consensus rating — Strong Buy. Out of 7 analysts tracked by TipRanks in the last 3 months, 6 are bullish on UTZ, while only one remains sidelined. With a return potential of ~16%, the stock’s consensus target price stands at $21.71. (See UTZ stock analysis on TipRanks)RingCentral, Inc. (RNG)From salty snacks we move on to telecom tech. RingCentral is a cloud-based business communications company. The company’s products are software platform packages that combine telephone and computer systems. The flagship product platform, RingCentral Office, allows compatibility of the communications system with other popular business apps including DropBox, Google Docs, Outlook, and Salesforce. RNG also offers unique features necessary for communications systems: call forwarding, phone extensions, vid calling, and screen sharing.Much of the modern business world is about problem solving, and RingCentral does just that for its customers – and the results are clear in the revenues and stock performance. The top line number has been increasing through 2020, with the Q3 revenues coming in at $303 million for a 9.3% sequential gain. The shares recovered easily from the mid-winter COVID swoon, and the stock is trading up 76% so far this year.On the negative side, RingCentral operates at a net loss, and that net loss has been deepening even as revenues rose and the stock appreciated. The Q3 EPS loss came in at 24 cents.James Fish, 5-star analyst with Piper Sandler, wrote the review on RNG, and he is upbeat about the company’s future. “RingCentral is winning new customers and expanding with existing given its ability to converge across the communication software stack, including with contact center… we continue to recommend RingCentral as one of our ‘core 4’ in our coverage and a name to own for the next few years,” Fish commented. Because of this, Fish reiterates RNG as his Prime Decide. The analyst charges the stock an Obese (i.e. Purchase) alongside a $362 price goal. At present ranges, that signifies a doable 21% upside for the approaching yr. (To observe Fish’s monitor report, click on right here)Total, RingCentral has 10 latest evaluations, together with 9 Buys and 1 Maintain, making the analyst consensus view a Sturdy Purchase. The typical price goal is $337.22, which suggests a 13% upside from the present buying and selling price of $297.79. (See RNG stock evaluation on TipRanks)DraftKings, Inc. (DKNG)The world of fantasy sports activities helps deliver followers into the video games, and now that the professional leagues have resumed play – albeit for abbreviated seasons, in deference to the coronavirus – DraftKings, which take fantasy leagues on-line, has been making positive factors. Along with fantasy league creation, DraftKings affords sports activities betting, and the corporate’s on-line model has slot in properly with the social distance restrictions put in place to fight the continuing virus well being disaster.Within the third quarter, whose outcomes had been reported earlier this month, DraftKings had loads of excellent news. Income, at $133 million, beat the forecast by $1 million, and the online loss per share was not as deep as analysts had feared. The corporate reported a key metric – month-to-month distinctive gamers – surpassing 1 million, an vital milestone. Wanting forward, DraftKings revised its fiscal 2020 steerage upward, by 5.7% on the midpoint of the vary, to $540 million to $560 million. The midpoint for 2021 income expectations is much more bullish, at $800 million.As famous, these positive factors come as the foremost sports activities leagues have returned to play. However that’s not the one key right here. DraftKings operates in 19 states plus DC – the jurisdictions which allow authorized on-line sports activities betting. However a further eight states are in varied phases of legalizing DraftKings’ area of interest, and the corporate appears to be like ahead to increasing its operations.Summing up the prospects for DraftKings, Rosenblatt analyst Bernie McTernan writes, “[DKNG] remains a top pick in our Consumer Tech coverage. 3Q results will continue the positive revenue estimate revisions given the better than expected guide for ’20E and ’21E. We are at the high end of the ’21E range which we believe is achievable given our expectation for at least MI and VA coming online.”The analyst added, “New state launches will pressure near-term adj. EBITDA but encouragingly the company indicates NJ, their most mature market, is in a similar spot where they had previously hoped it would be for its ramp in profitability.”McTernan charges DKNG a Purchase, and his $65 price goal implies a sturdy 41% one-year upside. (To observe McTernan’s monitor report, click on right here)All in all, there 19 evaluations on report for DraftKings, together with 13 Buys and 6 Holds, giving the stock a Reasonable Purchase ranking from the analyst consensus. The shares are at the moment priced at $46.24 and have a mean price goal of $59, making the upside potential for the yr forward 38%. (See DKNG stock evaluation on TipRanks)To search out good concepts for stocks buying and selling at engaging valuations, go to TipRanks’ Greatest Stocks to Purchase, a newly launched device that unites all of TipRanks’ fairness insights.Disclaimer: The opinions expressed on this article are solely these of the featured analysts. The content material is meant for use for informational functions solely. It is rather vital to do your individual evaluation earlier than making any funding.
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