As investors were so righteously reminded on Friday, many of the day-to-day Wall Street prognostications and strategy calls are almost always “best guesses” or data-based “assumptions.” The Wall Street consensus for the April nonfarm payrolls was 965,000, which made the 266,000 print miles off the actual mark. So, once again, for analysts and strategists it was back to the drawing board. The bottom line is that the drastic change in the way business is being done and has been conducted over the past year may mean some big changes are coming in the future.
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The biggest coming change may be that productivity will jump drastically, so gross domestic product growth may be very high with less labor participation, which could be a real game-changer. While the rotation to cyclical and value probably remains in place, it is smart to look to the future for stock ideas.

We screened the Jefferies top growth stocks to buy this week for ideas that fit into this potential changing narrative, and we found four that look like outstanding growth plays for more aggressive investors. It is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.

Freeport-McMoRan

This is one of the top picks across Wall Street in the mining and metals sector, and it is an outside way to play the electric vehicle trend. Freeport-McMoRan Inc. (NYSE: FCX) is the world’s largest publicly traded copper and moly producer, as well as the eighth largest gold producer. Its key operating and development assets are in Indonesia, North America, South America and Africa.

Highly leveraged toward copper mining, the company could be a big player in a scenario of rebuilding and repairing old and battered projects, and it clearly would benefit from stronger demand and higher prices for industrial commodities.

Jefferies has remained bullish on the company for some time and noted this in the research report:

We hosted a global call with Trafigura’s Chief Economist. He remains bullish on the current commodity cycle and sees room for significant further upside potential to commodity prices over the next one to three years. In particular, this is due to accelerating demand growth ex-China and supply constraints. He believes that this cycle is in very early stages as key demand drivers, such as pent up consumer demand, accelerating global capex and massive stimulus in the US, have yet to fully kick in. He called out copper in particular, as believes demand growth in China will be slow over the next ten years relative to the last decade, but expects demand in the rest of the world to strongly increase after having fallen over. Our top pick with leverage to copper remains Freeport MacMoRan.

The Jefferies price target for the shares is $55, well above the Wall Street consensus target of $39.29. Freeport-McMoRan stock popped almost 5% on Friday to close at $43.97 a share.

The recently merged company is now the largest cannabis company in a world, while more and more places in the United States are legalizing personal use. Tilray Inc. (NASDAQ: TLRY) engages in the research, cultivation, production and distribution of medical cannabis and cannabinoids. The company offers cannabis-lifestyle and consumer packaged goods, as well as hemp-based foods and alcoholic beverages. It offers medical cannabis in extracts and dried flower forms, and cannabis extracts, including purified oil drops and capsules.
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The company supplies cannabis extract products to patients, physicians, pharmacies, hospitals, governments and researchers. It has operations in Canada, the United States, Europe, Australia, New Zealand and Latin America. The company was formerly known as Aphria and changed its name to Tilray.

Jefferies last week gave the stock a rare double upgrade from Buy to Sell and noted this:

Aphria’s strong portfolio of 1.0 (flower) brands across targeted segments and price points sees the combined company with the number one value share in Canada at 17.1%. An equally strong combined company 2.0 portfolio (vapes, edibles, beverages) should see further gains. As a result, we see pro-forma fiscal year 2021 to fiscal year 2024 combined Tilray sales growing at 33% to leave 2024 sales at $1.7 billion versus the average major Canadian LP’s of $582 million and major US MSO’s of $1.6 billion. Meanwhile, with US participation increasingly possible sooner than later, we highlighted that potential upside from the US is significant, with a 2-5% market share equating to a DCF-driven enterprise value of $2.7 billion to $6.5 billion.

Jefferies has a $23 price target on Tilray stock, which compares with the lower $18.98 consensus and Friday’s final print of $16.18, which was up almost 15% for the day.

Horizon Therapeutics

This may be a great play for more speculative investors looking for health care ideas. Horizon Therapeutics PLC (NASDAQ: HZNP) focuses on researching, developing and commercializing medicines that address unmet treatment needs for rare and rheumatic diseases in the United States and internationally.

The company’s orphan and rheumatology marketed medicines include the following:

• Krystexxa, a medicine for the treatment of uncontrolled gout
• Ravicti for use as a nitrogen-binding agent for chronic management of adult and pediatric patients
• Procysbi for nephropathic cystinosis, a rare and life-threatening metabolic disorder
• Actimmune for chronic granulomatous disease
• Rayos for the treatment of multiple conditions, rheumatoid arthritis
• Buphenyl tablets for oral administration and Buphenyl powder for oral, nasogastric or gastrostomy tube administration
• Quinsair, a formulation of the antibiotic drug levofloxacin for the management of chronic pulmonary infections due to pseudomonas aeruginosa in adult patients with cystic fibrosis

In January of 2020, the U.S. Food and Drug Administration (FDA) approved Tepezza (teprotumumab-trbw) for the treatment of adults with thyroid eye disease, a rare condition where the muscles and fatty tissues behind the eye become inflamed, causing the eyes to be pushed forward and bulge outward. The approval represented the first drug approved for the treatment of thyroid eye disease.
Jeffries remains positive on Horizon Therapeutics:

The company reported solid first results and we raised our fiscal year 2021 and 2022 earnings-per-share estimates 6% and 1% primarily based on managements updated interest expense and diluted share guidance that now includes the recently completed VIE acquisition. We noted that post the transaction, the company is re-launching Uplinza, adding sales reps, support teams etc., which will lead to enhanced patient pull through according to management. For Tepezza, we project fiscal year 2021 sales of $1.3B billion and forecast second through fourth quarter sales of $309M, $510M, and $479M, which aligns with managements commentary for the rest of the year.

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Jefferies has set its price target at $120. The posted consensus target for Horizon Therapeutics stock is $114.45, and the closing trade on Friday was at $87.93 a share.

Zillow

With a huge focus now on real estate, especially through the internet, this is a great idea for the rest of 2021 and beyond. Zillow Group Inc. (NASDAQ: Z) is a digital real estate company that operates real estate brands on mobile applications and websites in the United States. It operates through three segments: Homes; Internet, Media & Technology; and Mortgages.

The company’s mobile applications and websites offer various real estate transactions and related services, including buying, selling, renting and financing services for residential real estate properties, as well as purchasing and selling homes, and title and escrow services, title insurance products and services and mortgage loans. Its portfolio of brands includes Zillow, Zillow Offers, Zillow Closing Services, Zillow Home Loans, Trulia, StreetEasy and HotPads.

After the company posted very strong results, the analysts said this:

Zillow reported first quarter results that once again exceeded consensus estimates and market expectations for both revenue and EBITDA. We pointed out that total company revenue/EBITDA was 11%/39% ahead of consensus, driven by continued elevated growth for Total internet, media, and technology and Mortgages, along with another sequential acceleration for Homes. Further, given the fact that the company is already exceeding its near-term profit guardrail at sub-scale improves our confidence that Zillow Offers could become a key driver of profitability, particularly once high-margin adjacencies gain further adoption.

The $215 Jefferies price target compares with a much lower $186.53 consensus target. Zillow stock closed at $118.54 a share on Friday.

The world is changing as fast now as it ever has. The black swan COVID-19 pandemic forced radical changes in all aspects of business and the economy, many of which may be here for good. All four of these stocks look poised to advance into the future, and there is some big upside to the Jefferies price targets.

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