With 2023 rolling along in reasonably good fashion for stock investors, the biggest buzz this year has of course been the artificial intelligence melt-up. While the trend is certainly here to stay, many of the top stocks have exploded higher and are likely overbought and ready to take a breather, which certainly seemed like the case on Thursday as investors sold the strength of the Nvidia numbers. Grabbing a hot stock going into the worst time of the year for stocks may not be the best idea right now, as many found out this week.
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The safe route is the best route for many now as seasonal weakness is playing out as expected, but more aggressive growth investors have the opportunity to scoop up some stocks now at a discount that have some big-time upside potential. Investors with a risk profile that can accommodate the current environment are probably looking for Wall Street’s best ideas, and we found five of them.
One of Wall Street’s most respected lists of stocks to buy is the Goldman Sachs Conviction List. These are the firm’s top picks for high net worth and institutional investors spread across multiple sectors. We screened the list looking for the picks that had the largest upside to the Goldman Sachs assigned target prices. We found five that aggressive accounts may want to add to portfolios that have huge upside to the Goldman Sachs target price objectives.
It is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.
First Solar
This top company is a top pick for 2023 and has been on the Goldman Sachs Conviction List of favorite stocks to buy for years. First Solar Inc. (NASDAQ: FSLR) provides photovoltaic (PV) solar energy solutions in the United States, Canada, France, Japan, India and elsewhere.
The company designs, manufactures and sells cadmium telluride solar modules that convert sunlight into electricity. It serves developers and operators of systems, utilities, independent power producers, commercial and industrial companies, and other system owners.
First Solar also develops and sells downstream solar projects and has created some of the largest solar installations in the country. While there have been some trade-related concerns over the year, solid earnings should keep a nice tailwind behind the shares. With systems business and module guidance very achievable, this is perhaps the strongest player in the industry.
Goldman Sachs has a $272 price objective for First Solar stock. The consensus target is lower at $224.24. Shares closed on Thursday at $174.42. Investors can grab a huge 65% gain if the stock hits the Goldman Sachs target.
Salesforce
This company was an innovator in customer relationship management software. Salesforce Inc. (NYSE: CRM) provides customer relationship management technology that brings companies and customers together worldwide. Its Customer 360 platform empowers its customers to work together to deliver connected experiences for their customers.
Salesforce’s Service offerings include:
- Sales, to store data, monitor leads and progress, forecast opportunities, gain insights through analytics and relationship intelligence and deliver quotes, contracts and invoices
- Service, which enables companies to deliver trusted and highly personalized customer service and support at scale
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Its Service offerings also comprise flexible platform that enables companies of various sizes, locations and industries to build business apps to bring them closer to their customers with drag-and-drop tools; online learning platform that allows anyone to learn in-demand Salesforce skills; and Slack, a system of engagement.
Further Service offerings include:
- Marketing, which enables companies to plan, personalize and optimize one-to-one customer marketing journeys
- Commerce, which empowers brands to unify the customer experience across mobile, web, social and store commerce points
- Tableau, an end-to-end analytics solution serving various enterprise use cases
- MuleSoft, an integration offering that allows its customers to unlock data across their enterprise
The company provides its Service offerings for customers in financial services, health care and life sciences, manufacturing and other industries.
The company also offers professional services and in-person and online courses to certify its customers and partners on architecting, administering, deploying and developing its service offerings. The company provides its services through direct sales and consulting firms, systems integrators and other partners.
The Goldman Sachs target price is $325, while Salesforce stock has a consensus target of just $237.48. From Thursday’s $205.51 close, hitting the Goldman Sachs target would be more than a 55% gain.
24/7 Wall St.Shift4 Payments
This is a newer addition to the list and is a solid idea for investors looking for ideas out of the spotlight. Shift4 Payments Inc. (NYSE: FOUR) provides software and payment processing solutions in the United States.
The company provides omnichannel card acceptance and processing solutions, including credit, debit contactless card; Europay; Mastercard and Visa; QR Pay; and mobile wallets. It provides alternative payment methods; merchant acquiring; proprietary omnichannel gateway; complementary software integrations; integrated and mobile point-of-sale (POS) solutions; security and risk management solutions; reporting and analytical tools; and web-store design, hosting, shopping cart management and fulfillment integration; and tokenization, payment device and chargeback management, fraud prevention and gift card solutions.
Its VenueNext provides mobile ordering, countertop POS, and self-service kiosk services, as well as a digital wallet to facilitate food and beverage, merchandise and loyalty for stadium and entertainment venues. Shift4Shop offers an e-commerce platform that provides everything a merchant needs to build their business online.
In addition, it provides Lighthouse, a cloud-based business intelligence tool that includes customer engagement, social media management, online reputation management, scheduling, and product pricing, as well as reporting and analytics; SkyTab POS, a POS workstations pre-loaded with software suites and integrated payment functionality; SkyTab Mobile, a mobile payment solution; and marketplace technology for integrations into third-party applications. Additionally, it provides merchant underwriting, onboarding and activation, training, risk management, and support services; and software integrations and compliance management, and partner support and services.
The $87 Goldman Sachs price target compares with a consensus target of $83.05. Shift4 Payments stock closed on Thursday at $54.72, so hitting the target would be a 58% gain.
Warner Bros. Discovery
The stock has been crushed since the merger between the two companies, giving investors an awesome entry point. Warner Bros. Discovery Inc. (NASDAQ: WBD) operates a media and entertainment company worldwide.
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The Studios segment produces and releases feature films for initial exhibition in theaters; produces and licenses television programs to third parties and networks and direct-to-consumer services; distributes films and television programs to various third parties and internal television; and offers streaming services and distribution through the home entertainment market, themed experience licensing and interactive gaming.
The Network segment comprises domestic and international television markets, while the DTC segment offers premium pay-tv and streaming services.
In addition, the Warner Bros. Discovery offers a portfolio of content, brands, and franchises across television, film, streaming and gaming under the Warner Bros. Pictures Group, Warner Bros. Television Group, DC, HBO, HBO Max, Discovery Channel, Discovery+, CNN, HGTV, Food Network, TNT, TBS, TLC, OWN, Warner Bros. Games, Batman, Superman, Wonder Woman, Harry Potter, Looney Tunes, Hanna-Barbera, Game of Thrones and The Lord of the Rings brands.
Further, it provides content through distribution platforms, including linear network, free-to-air and broadcast television, as well as authenticated GO applications, digital distribution arrangements, content licensing arrangements and direct-to-consumer subscription products.
Warner Bros. Discovery stock has a $20 price target at Goldman Sachs. The consensus target is $19.80, and shares closed on Thursday at $12.70. The Goldman Sachs target represents a 60% gain.
WW International
If you have ever tried to lose weight, then this company may have helped at some point. WW International Inc. (NASDAQ: WW) provides weight management products and services worldwide. It offers a range of nutritional, activity, behavioral and lifestyle tools and approaches products and services.
The company provides various digital subscription products to wellness and weight management businesses, which provide interactive and personalized resources that allow users to follow its weight management program through its app and web-based platform, including personal coaching and digital products. And it allows members to inspire and support each other by sharing their experiences with other people on weight loss and weight management journeys.
In addition, it offers various consumer products, including bars, snacks, cookbooks, kitchen tools and other products. Further, the company licenses its trademarks and other intellectual property in food, beverages and other relevant consumer products and services, as well as provides publishing services. It offers products through e-commerce platforms and through partners. The company was formerly known as Weight Watchers International and changed its name in September 2019.
Goldman Sachs has set a $17 price target. The consensus target is $11.40, and shares closed Wednesday at $9.32. WW International stock investors will see an 80% gain at the Goldman Sachs price target.
With all five stocks having double-digit upside potential, they make good sense for growth stock investors looking for ideas that will continue to work regardless of the economy or the inflation picture, which all of these should. With second-quarter earnings all but over and a strong year-to-date rally that has driven many stocks higher, it makes sense to buy partial positions here, as we are in the worst time of the year for stocks from a performance standpoint.
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