Netflix co-founder and CEO Reed Hastings gave a speech as he opened new Netflix offices in France, in Paris on January 17, 2020.
Christophe Archambault AFP | Getty Images
As the earnings season kicks off in the second quarter, Wall Street analysts point to stocks that are poised for impressive quarterly performance.
The companies mentioned below fall into this category. Most importantly, however, analysts who identify these names can boast of proven success. TipRanks Analyst Prediction Service trying to determine the analysts with the best performance on Wall Street. These are the analysts with the highest success rates and average returns per grade, taking into account the number of grades published by each analyst.
Here are five stocks that leading Wall Street analysts expect to achieve strong earnings results.
As for the streaming giant Netflix, JPMorgan analyst Doug Anmuth remains “earning positive”, thanks to solid content in the second half of 2021.
To that end, the five-star analyst maintained a buy rating and a target price of $ 600 per share, before announcing earnings on July 20th. This target represents a potential for a 10% increase.
“Although the earnings debate around the company has increased, we believe the overall expectations and feelings about the NFLX are still quite subdued. However, we remain positive about earnings and 2H21 because we believe the NFLX could have the strongest six-month content ever , this is moving further and further away from the withdrawal of the pandemic, and the NFLX should make greater progress in insufficiently penetrated international markets, ”Anmuth said.
Based on an analytical analysis of global acquisitions, he expects net additions for the second quarter to be approximately 2 million, compared to his previous estimate of 1.6 million. However, he admits that it is “still small on an absolute basis, especially on the basis of more than 200 million subscribers”.
In this regard, the content composition encourages Anmuth’s optimism. Some of these titles include “Kissing Booth 3,” “Red Notice,” and “Don’t Look Up,” with new seasons of “Money Robbery,” “Sex Education,” “Witch” and “You” it should also be released.
Moreover, for the second half of 2021, Anmuth projects 14.25 million net additions, with annual gains in the third and fourth quarters.
With a 70% success rate and an average return of 26.8%, Anmuth is ranked 65th on TipRanks ’list of analysts with the best performance.
As a token of trust, Oppenheimer’s Jason Helfstein only increased his price target by Etsy from $ 200 to $ 225, bringing the growth potential to 23%, before earnings were announced on August 5th. In addition, the top analyst maintained the Buy rating.
Despite “severe Q2 complications,” Helfstein tells investors he expects impressive conversion and customer retention trends based on third-party data.
According to SimilarWeb, the gains in outbound visits to Etsy’s payment sites are strongly linked to revenue growth in the market compared to last year. “Given that Q2 outbound visits are 27% higher than last year, we believe the conversion trends are still strong, with an indication of regression Market revenue in Q2 34% more than last year, compared to Street’s estimate of 17% over last year and Opco’s estimate of 23% more, ”Helfstein said.
On top of that, SimilarWeb data points to a 21% increase in web and mobile network traffic in the second quarter, giving Helfstein “confidence in sustainable customer retention, even after the U.S. economy largely opened up.”
It also highlights the fact that traffic rose 76% from the average level before the pandemic, “noting that Etsy did an effective job of educating customers about the breadth and depth of the market,” according to analysts.
All of this prompted Helfstein to comment: “Data on increased traffic gives us the belief that Q2 results should meet or slightly exceed the high-income guidelines (25% more than last year).” As such, it forecasts revenue growth in the second quarter of 26% more than last year, while Street calls for a 22% -plus.
It should be noted that Helfstein’s updated target sets a 10% premium for some of his peers in space. In view of this, he believes that “the premium for the group is justified given the higher expected growth, expansion into international markets and EBITDA support compared to counterparts yet to reach EBITDA B / E”.
One of the top 20 analysts with the best performance, Helfstein boasts a success rate of 71% and an average return of 41.3%.
On your heels Radware’s major applications and winning contracts, Needham analyst Alex Henderson has given a thumbs up for vendor applications and cyber security solutions. In addition to upgrading the rating from Hold to Buy, the analyst set a target price of $ 40 (potential for growth of 28%).
In 2021, the company revealed nine gains in development and partnership, which, according to Henderson, sets “an acceleration of business as these projects grow.”
He added, “Most of these projects appear to be material contributors to revenue as soon as they increase, although the exact timing of their contribution to growth is unclear. We think this not only suggests accelerating revenue growth, but also emphasizes a differentiated approach to market penetration through partnerships. This has become the main strength of the Radware model. “
As a result, Henderson claims “Radware is likely to beat conservative guidelines and offer a stronger outlook for CY2H than forecast,” when it publishes a quarterly press release later this month.
Although the company does not offer guidance for its cloud subscription segment, Henderson notes that “it sounds like it expects comparable growth over the rest of the year with strong momentum for bookings.” Total annual recurring income for the job jumped 10% from last year, to $ 176 million, including contracts to maintain services from the traditional business.
When it comes to corporate demand, Henderson’s field check “pretty clearly suggested improving the demand environment”. While it is not disputed that “supply constraints on components are obstacles to short-term development”, overall, the trajectory is getting stronger.
So, after a strong first quarter in which the growth of the company increased to 20% compared to last year, the analyst thinks that “a phase has been prepared to accelerate growth”.
Earning 58th on the TipRanks rankings, Henderson achieved 69% success and 29.3% average return on rating.
As Johnson & Johnson preparing to deliver quarterly issues on July 21, Wells Farga analyst Larry Biegelsen sticks to his Buy rating. It also kept the target price of $ 190 as it is, suggesting that the potential growth potential could be 11%.
It should be noted that the analyst lowered its forecast for total sales in the second quarter by $ 300 million to $ 22.7 billion, or 20.7% of adjusted operating growth, as a result of lower sales of Covid-19 vaccines. Meanwhile, the consensus estimate records total sales of $ 22.5 billion. However, Biegelsen says that “despite lower sales, our EPS estimate for Q2 increases by $ 0.04 to $ 2.28 (consensus $ 2.29) on lower OpEx assumptions and tax rates.”
When it comes to street projections, the analyst expects Johnson & Johnson to at least meet expectations for both the top and bottom line, as the tone of investor conferences in the second quarter was positive.
Although there are no changes in Biegelsen’s estimates of consumers or pharmacy for the second quarter, he gave his second quarter EPS assessment an increase of $ 0.04, and the figure is now $ 2.28.
Turning to its segment of medical products (MD), this part of the business has experienced an impressive turnaround. At the start of the pandemic, MD recorded a 33% drop in sales. Now management believes the second quarter could be the biggest quarter of sales growth due to “easy” complications.
Biegelsen said, “In addition, on a dollar basis, management expects MD sales to grow sequentially (on a dollar basis) from $ 6.58 billion in the first quarter. We increased the forecast for MD sales for the second quarter from 6, 77 billion to $ 6.73 billion (2% plus consecutive)), which is now ahead of the consensus of $ 6.46 billion.Our forecast assumes 54% annual growth in MD sales in Q2 or ~ 3.4% growth during 2019 . “
What else could investors see in the JNJ press? “We see the potential for JNJ to increase its guidelines for 2021,” Biegelsen commented, and the company provided a range of guidelines ranging from $ 9.42 to $ 9.57. Currently, the analyst is asking for 2021 EPS of $ 9.57, compared to Wall Street’s estimate of $ 9.56.
Supporting his first place on the TipRanks list, Biegelsen achieved 71% success and 22.1% average return per grade.
After debuting in the public market on June 16, big things could be expected WalkMe, says Needham analyst Scott Berg.
The five-star analyst began coverage of digital adoption platform service providers with a Buy rating and set a target price of $ 40 (growth potential of 37%).
“WalkMe is an early leader in the newly created space of the Adoption Platform, which we expect to develop into a large end market over time. We believe that tools like WalkMe address one of the most critical corporate challenges of the 21st century: how to improve the adoption and productivity of an increasing number of software solutions that employees are required to use for their work, ”Berg said.
For the June quarter, Berg expects total revenue to reach $ 45.04 million, a year-on-year gain of 23.3%, and believes his estimate of 28% annual growth in subscription revenue could “prove conservative” based on “industry.” “checks indicating high demand for the platform in all market segments. “That being said, non-GAAP EPS could come – $ 0.21, according to Berg. For fiscal year 2021, the analyst thinks total revenue will reach $ 187.7 million, reflecting growth of 26.6%.
He added, “We note that the level of conservatism built into our current estimates implies accelerating growth in 2H / 21 and FY22. We believe the company is investing in sales and marketing along with a partner ecosystem to support them. estimates and growth trends. “
What are the prospects for demand? Berg believes “as the number and complexity of applications grows, companies will increasingly demand solutions like WalkMe to bridge the adoption gap more efficiently.” He also claims that “WalkMe’s product strategy and investment position the company as a leader in the DAP market.”
As for the estimate, Berg considers it “attractive”, considering that its shares are trading at a discount of 15 times higher than the group of equal companies with a growth of 30% to 40%. “
Currently, the leading analyst with 10 places monitors 76% success rate and 33.2% average return on rating.