It’s that time again, the most wonderful time of the year (if you ask Andy Williams). With the holiday season comes the surge of consumers taking to the stores, both physical and online, in search of the perfect gifts for loved ones. However, consumers aren’t the only ones shopping up a storm.
Investors are on the hunt and ready to snap up the Street’s must-have names. We mean the highly sought-after stocks whose growth stories are nowhere near their finales, ready to deliver rewards long past the ringing in of the new year.
Given that 2019 has witnessed a record-smashing performance from the market, how are investors supposed to find these stocks with stellar long-term growth prospects? Wall Street’s seasoned pros suggest focusing on the best of the best, or the tickers that have racked up fierce analyst support.
With this in mind, we used TipRanks’ Stock Screener to track down seven stocks with compelling growth narratives worthy of a spot on any wish list. To top it off, each of the names has received enough bullish calls in the last three months to earn a “Strong Buy” consensus rating.
Let the shopping spree begin.
OUTFRONT Media (OUT)
OUTFRONT Media (NYSE:OUT) provides out-of-home advertising space in the U.S. and Canada, with its inventory primarily located on heavily-traveled highways, transit and on-campus advertising displays. Given its latest earnings report, the Street has been impressed by the REIT.
Part of the appeal lies with the steadiness of the business with respect to both earnings and revenue growth. While this space can be weighed down if the economy falters, OUT’s third quarter suggests that the advertising market remains strong.
Substantial top-line growth in terms of U.S. local and national advertising drove a year-over-year revenue gain of 11.7%. However, accumulating transit franchise costs and billboard lease expenses did hamper results, with adjusted funds from operations falling just short of the consensus estimate.
Barrington analyst James Goss acknowledges the transit franchise segment has been expanding, with its most notable project being the New York MTA deal as a result of its size. He expects that these efforts and skills being developed in New York “would be viewed as invaluable for potential competitive bids.” Goss adds that he might update the price target as “recent excellent price action has moved the price…close to this level.” Bearing this in mind, the analyst keeps the rating at “outperform.” At the current $29 price target, shares could surge 14% in the next twelve months.
Like Goss, the rest of the Street is on the same page. As 100% of the analysts that have published recommendations in the last three months are bullish, the consensus is unanimous: OUT is a “strong buy.” Adding to the good news, the upside potential comes in at 27% based on the $32 average price target. See the OUT stock analysis.
Automated tax compliance software company Avalara, Inc. (NYSE:AVLR) has hit the ball out the park in 2019 with a 134% year-to-date run. Don’t worry, the good news doesn’t end here.
Back in 2018, the Supreme Court of the U.S. ruled in South Dakota v. Wayfair that states are allowed to require remote sellers to collect and remit sales tax based on the establishment of an “economic nexus,” referring to a sales and use tax obligation. So what does this have to do with AVLR?
Since the decision, the software company has continued to benefit from robust customer momentum. This is evidenced by its most recent quarterly results, in which AVLR posted revenue growth of 43% year-over-year. Net retention rates also gained traction, reflecting the company’s ability to upsell its customer base.
By no means is it stopping there. The company has placed a significant focus on widening its cross-border tax compliance capabilities in an attempt to fuel growth on an international level. All of the above played into Mizuho Securities analyst Siti Panigrahi’s decision to stay with the bulls. Along with the bullish call, the $95 price target implies 32% upside potential from current levels.
Similarly, other analysts are betting on the software stock. With six “buys” assigned in the last three months compared to no “holds” or “sells,” the word on the Street is that AVLR is a “strong buy.” Additionally, the upside potential of 35% surpasses Panigrahi’s forecast. See the AVLR stock analysis.
First Solar (FSLR)
First Solar (NASDAQ:FSLR) wants to provide reliable, dependable and cost-effective renewable energy solutions, currently operating many of the world’s largest grid-connected PV power plants. On the heels of a recent ratings upgrade, the future looks bright for FSLR.
JMP Securities Joseph Osha tells investors that the company’s competitive standing in the U.S. hasn’t been factored into the share price. Using its innovative technology, the company has been able to rapidly improve its energy yield, lower LCOE (levelized cost of energy), and provide stable grid integration. It doesn’t hurt that FSLR can deliver an LCOE with prices that fall right in line with those of fossil fuels.
Additionally, Osha points out that the solar energy company has been transitioning to a new manufacturing plan. He argues that these efforts have already proven successful as its backlog coverage spans well into 2021, noting that the recent pullback presents investors with a unique buying opportunity.
To this end, the four-star analyst lifted the rating from “market perform” to “outperform” and set a $70 price target. This conveys his confidence in FSLR’s ability to rise 30% in the coming twelve months.
All in all, the rest of the Street takes an optimistic approach when it comes to FSLR. Eight “buys” and one “hold” make the consensus rating a “strong buy.” Based on the $71 average price target, there is room for 32% upside potential. See the FSLR stock analysis.
eHealth, Inc. (NASDAQ:EHTH) is best known as an online health insurance marketplace serving individuals, families and small businesses in the U.S. Even with its 153% year-to-date gain, several members of the Street say this growth story is only just beginning.
First and foremost, EHTH just had a solid third quarter. Revenue jumped 72% from the prior-year quarter to reach $69.9 million. While it did post a loss, submitted applications for Medicare products increased an impressive 66%, addressing any concerns regarding churn.
These results combined with management’s outlook for full year 2019 prompted a wave of bullish calls from the Street’s analysts. Out of four analysts covering the stock over the previous three months, all of them picked this name, making the consensus a “strong buy.” On top of this, the $108 average price target lends itself to a potential twelve-month gain of 16%.
One of the analysts singing EHTH’s praises is Cantor Fitzgerald’s Steven Halper. He believes that given management’s prediction that the decline in lifetime value will be less than previously expected, as well as its guidance for full year 2019, the company is on an upward trajectory. Taking this into consideration, Halper kept his bullish rating and $120 price target, indicating 29% upside potential. See the EHTH stock analysis.
Glu Mobile (GLUU)
Glu Mobile (NASDAQ:GLUU) is best known for publishing mobile games like “Diner Dash” and “Kim Kardashian: Hollywood.” With a strong lineup of games expected to be released in 2020, there’s no question that this name is on the Street’s radar.
D.A. Davidson analyst Franco Granda tells investors that the recent pullback presents an attractive entry point. “We view Glu as one of the leading developers of free-to-play mobile games and one of the best ways to play the growing $70 billion mobile gaming market,” he commented.
On top of this, he adds:
With shares back to early 2018 levels, the company’s much better fundamental position from a few years ago, the expectation of more robust cash generation, and the launch of what could become its largest game a couple of quarters out (Disney Sorcerer’s Arena), the risk reward profile is attractive. All in, we believe this growth story is in its early innings and expect a meaningful bookings and earnings ramp in the years ahead.
As a result, Granda decided to start GLUU coverage by recommending that investors snap up shares. To accompany the call, he set an $8 price target, which implies that shares could jump 43% higher in the next twelve months.
Like the D.A. Davidson analyst, other Wall Street analysts are getting on board. Over the previous three months, out of the four analysts that have published ratings in the last three months, 100% sided with the bulls. Additionally, the $7 average price target suggests 25% upside potential. See the GLUU stock analysis.
Five Below (FIVE)
Discount store chain Five Below (NASDAQ:FIVE) racked up analyst support ahead of the holiday season. We’re talking 11 “buy” ratings in just the last three months.
The company’s fourth quarter makes up 40% of sales as well as 60% of EBITDA, with the month of December accounting for almost half of this contribution. With this in mind, this year’s shortened selling period further underscores the significance of the 27-day period between Thanksgiving and Christmas.
Loop Capital analyst Anthony Chukumba highlights FIVE as looking strong going into the holiday shopping season. In particular, he argues that its focus on taking advantage of the release of “Frozen 2” with merchandise is “encouraging” given that the movie is expected to be one of the top grossing films of the year. This could drive a multi-quarter comparable sales growth as well as significantly bolster earnings.
As a result, Chukumba decided to stay with the bulls and keep the $145 price target. At this target, the four-star analyst believes that shares have the potential to surge 20% in the next twelve months. This comes in just under the Street’s forecast of 21% upside potential, based on the $146 average price target. See the FIVE stock analysis.
Telaria, Inc. (NYSE:TLRA) offers a complete video management platform that includes an ad-server as well as live analytics dashboards so customers can effectively manage all of their content. While shares have trended downward recently as a result of the softness and secular decline of the desktop business, one analyst tells investors to buy on this weakness.
Lake Street’s Mark Argento cites its connected TV (CTV) business as a key point of strength for TLRA. In its most recent quarter, CTV revenue, which made up 44% of the total quarterly revenue, came in at $7.3 million, a whopping 115% year-over-year gain.
Adding to the good news, CTV momentum drove eCPM growth of 27% year-over-year to $15.68, from $12.32 last year. “CTV gross margins have been stable at ~88% and we expect strong growth to continue with the overall mix likely eclipsing 50% of total revenue towards the end of 1H’20, which should also provide upside to margins from current levels,” he commented.
On top of this, Telaria reported several key publisher wins including Crown Media and Plex TV in the U.S., its first deal in Japan with a top broadcaster, three publishers in Canada and a large group of Australian publishers during the quarter. TLRA also added a new group of addressable audience-based buying solutions called Audience Connect and new features to enhance brand safety controls.
All of the above factors caused the analyst to leave the “buy” rating and $11 price target unchanged. At this target, shares could see a possible gain of 36% in the next twelve months. See the TLRA stock analysis.
TipRanks offers investors the latest insight into eight different sectors by tracking the activity of over 5,000 Wall Street analysts. As of this writing, Maya Sasson did not hold a position in any of the aforementioned securities.