With the third-quarter earnings extravaganza nearing the end, and the market focused on this Friday’s big nonfarm payroll job report, now could be a great time for investors to reset their portfolios for the final two trading months of 2015. While some see the potential for some near-term volatility, most believe that the market will follow the historical path and rally into year end.

A new research report from Jefferies is focused on growth stock calls that have significant upside lying in front of the stocks. While certain companies remain favorites at the firm, some others are new to the list this week. We found four that could offer investors solid near-term upside potential.

Anacor Pharmaceuticals

This company has been hit hard as upheavals in the specialty pharmaceutical area have proved damaging to all. Anacor Pharmaceuticals Inc. (NASDAQ: ANAC) is a biopharmaceutical company focused on discovering, developing and commercializing novel small-molecule therapeutics derived from its boron chemistry platform.

Anacor’s first approved drug, Kerydin (tavaborole) topical solution, 5%, is an oxaborole antifungal approved by the U.S. Food and Drug Administration (FDA) in July 2014 for the topical treatment of onychomycosis of the toenails. In July 2014, Anacor entered into an exclusive agreement with Sandoz, a Novartis company, pursuant to which PharmaDerm, the branded dermatology division of Sandoz, distributes and commercializes Kerydin in the United States.

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Anacor’s lead product development candidate is Crisaborole, an investigational non-steroidal topical PDE-4 inhibitor for the potential treatment of mild-to-moderate atopic dermatitis and psoriasis. The company just released positive top-line results from its long-term safety study for Crisaborole and they were very positive. Beyond Kerydin and Crisaborole, Anacor has discovered three investigational compounds that it has out-licensed for further development.

Jefferies remains positive on the Crisaborole prospects and moved pricing up by 29% back in the summer as its checks reveal that branded prices for Elidel/Protopic have steadily increased.

The Jefferies price target for the stock is $171. The Thomson/First Call consensus target is $175.25. The shares closed up over 7% Friday at $112.41.
Electronic Arts

This company is a leading video game developer that should benefit from not only the continuing rise in new console sales, but the rising trend of mobile gaming. Electronic Arts Inc. (NASDAQ: EA) produces top-selling games and related content and services under the EA brand in various categories, including action-adventure, role playing, racing and first-person shooter games.

The company, which is very well known for their EA sports games like Madden Football, has made the move into mobile play by adapting many of the top franchise titles, which have been popular for years, into the mobile arena. The company reported solid earnings last week and raised its guidance for Star Wars Battlefront to 13 million units. Jefferies thinks this is a very beatable number.

The Jefferies price target is $95, but the consensus target is $82.25. The stock closed Friday at $72.07.

PayPal

This company was recently spun off from eBay, and many on Wall Street think the real growth is in the payment sector. PayPal Holdings Inc. (NASDAQ: PYPL) operates as a technology platform company that enables digital and mobile payments on behalf of consumers and merchants worldwide. It enables businesses of various sizes to accept payments from merchant websites, mobile devices and applications, as well as at offline retail locations through a range of payment solutions across company’s payments platform, including PayPal, PayPal Credit, Venmo and Braintree products. The company’s platform allows customers to pay and get paid, withdraw funds to their bank accounts and hold balances in their PayPal accounts in various currencies.

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Jefferies thinks that solid revenue growth over the next five years is possible and the scarcity value, or lack of competition, could help drive the multiple for the company. Some Wall Street analysts have pointed to the new acquisitions PayPal has made like Venmo and Paydiant that are leveragable with the combination of Paydiant. Many also think that the eBay separation is likely to help the company’s positioning with large merchants.

Jefferies noted that while the company only reported in-line numbers and guidance its first time out, the strong secular growth in the payments industry and improved operating margins make the stock a solid buy.

The Jefferies price target is $44, and the consensus target is $41.67. The shares closed on Friday at $36.01.

Surgery Partners

Jefferies is very bullish on the growth prospects here. Surgery Partners Inc. (NASDAQ: SGRY) had a recent initial public offering, and the stock has stumbled somewhat coming out of the gate. This leading health care services company with a differentiated outpatient delivery model is focused on providing high-quality, cost-effective solutions for surgical and related ancillary care in support of both patients and physicians. Founded in 2004, Surgery Partners is one of the largest and fastest growing surgical services businesses in the country, with a portfolio of 99 surgical facilities comprised of 94 ambulatory surgery centers and five surgical hospitals across 28 states.

Jefferies expects an outstanding 20% EBITDA over the next three years owing to volume/pricing, as well as ancillary services and synergies from the Symbion acquisition. The firm also thinks that the company could continue to use mergers and acquisition activity to drive upsides to current earnings estimates.

Jefferies initiates coverage at Buy and a solid $27 price target. The consensus target is lower at $23.67. The stock closed Friday at $16.82.

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Jefferies continues to track and recommend solid growth stories in which there remains more than ample upside for investors buying shares at current trading levels. That noted, these recommendations are more suitable for growth accounts with a higher risk tolerance.

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