Top Wall Street analysts prefer these three stocks for the long haul

In this photo illustration, the CrowdStrike Holdings, Inc. logo is displayed on a smartphone screen. 

Rafael Henrique | SOPA Images | Lightrocket | Getty Images

Investors’ worries about the prospect of higher-for-longer interest rates have made a comeback, pulling the major averages lower this past week.

Even as markets seem turbulent for now, it’s key for investors to keep a long-term focus and to find stocks that can offer attractive returns for years to come.

With that in mind, here are three stocks favored by the Street’s top pros, according to TipRanks, a platform that ranks analysts based on their past performance.

CrowdStrike

This week’s first stock pick is cybersecurity provider CrowdStrike (CRWD). The company recently impressed investors with strong quarterly results and upbeat guidance. It also announced that it would acquire Flow Security, which provides cloud data runtime security solutions.  

Mizuho analyst Gregg Moskowitz highlighted that CrowdStrike is experiencing solid traction for its Falcon Cloud Security, Identity and next-gen LogScale SIEM (security information and event management) offerings, with management disclosing that these products collectively contributed more than $850 million to annual recurring revenue.

The analyst also noted that the company closed several large transactions in the fourth quarter, including more than 250 deals with a value of greater than $1 million. Additionally, deal volume surged 30% year over year across all customer cohorts.

Explaining his bullish stance, Moskowitz said, “CRWD’s cloud platform remains very differentiated, its GTM [go-to-market] is unrivaled,” and the company is witnessing more success beyond the traditional endpoint security markets.

The analyst views CrowdStrike as a generative artificial intelligence beneficiary. Moskowitz reiterated a buy rating on CRWD stock and raised the price target to $390 from $360.

Moskowitz ranks No. 132 among more than 8,700 analysts tracked by TipRanks. His ratings have been profitable 62% of the time, with each delivering an average return of 16.5%. (See CrowdStrike Ownership Structure on TipRanks) 

Nike

We move to athletic footwear and apparel maker Nike (NKE). Earlier this month, Guggenheim analyst Robert Drbul reiterated a buy rating on Nike stock with a price target of $130, adding it as a “best idea.” The analyst thinks that the pullback in the stock — which is down more than 8% in 2024 — offers an attractive entry point with a favorable risk/reward profile.

“We believe Nike is laying the groundwork for impactful launches of new product (led by basketball, but also running) to deliver an acceleration in top line growth in 2H24 and into 2025,” said Drbul.

The analyst noted the company has been increasing its focus on the highly competitive running category after losing ground over the past few years. He anticipates that the category’s growth will be supported by an array of new launches, including the Pegasus 41.

Drbul also expects the Nike brand to be highly visible at the upcoming 2024 Summer Olympics. Further, he thinks that the Jordan brand continues to be strong and that it presents a large opportunity for the company in the international, women’s and kids’ segments. He highlighted that the Jordan brand is on the path to emerge as the second-largest brand in North America.

Additionally, the analyst sees the possibility of gross margin expansion, with higher prices, favorable ocean freight rates and supply chain improvements more than offsetting the impact of increased product costs.

Drbul holds the 565th position among more than 8,700 analysts tracked by TipRanks. His ratings have been profitable 59% of the time, with each delivering an average return of 7.9%. (See Nike Stock Buybacks on TipRanks) 

BJ’s Wholesale Club

Warehouse chain BJ’s Wholesale Club (BJ) recently reported mixed results for the fourth quarter. The company’s earnings surpassed analysts’ consensus estimate, but revenue, which grew 8.7% year over year, fell short of expectations.

Nonetheless, Baird analyst Peter Benedict was impressed with the company’s performance. He reiterated a buy rating on BJ stock and increased the price target to $90 from $80. The analyst noted that the company delivered encouraging top-line key performance indicators, including traffic and units, even as disinflation continued to weigh on the average basket size.

The analyst thinks that BJ’s is making good progress in transforming its general merchandise business through various efforts, including enhancing its assortment and product presentation and ramping up its marketing efforts. Interestingly, general merchandise comps are expected to outpace grocery comps in FY24.

Benedict also highlighted BJ’s solid real estate pipeline and its plan to open 12 clubs this year. Further, he noticed the retailer’s healthy membership trends, with membership fee income increasing 6.5% in the quarter and the tenured renewal rate remaining strong at 90%.  

“With a healthy balance sheet and still-reasonable valuation, we continue to highlight BJ as an attractive long-duration mid-cap staple GARP [growth at a reasonable price] idea,” the analyst said.    

Benedict ranks No. 74 among more than 8,700 analysts tracked by TipRanks. His ratings have been profitable 69% of the time, with each delivering an average return of 15.2%. (See BJ’s Wholesale Technical Analysis on TipRanks) 

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