VMware at the NYSE, December 14, 2021.
Source: NYSE
Stocks have had a rocky start to 2022, and there could be further turmoil for investors.
This is because the current macro environment has been the most volatile in recent memory. Fears of inflation, labor shortages and the Federal Reserve's aggressive push to scale back their bond purchases are some of the concerns on investors' minds.
TipRanks, a financial data aggregation website, provides investors with the tools they need to navigate the market. Top Wall Street analysts are naming their sharpest views despite tough macro trends.
Verint
The shift to cloud-based solution platforms coincides with the massive digital transformation accelerated by the pandemic. Software and intelligence provider Verint Systems (VRNT) is expected to be one of the beneficiaries.
In a recent report, Jefferies' Samad Samana details his direction for the stock, noting that "VRNT's progress on modernizing and growing its technology stack and product portfolio has not been appreciated." He called for the flexibility level of Verint's infrastructure, which "can be deployed across multiple cloud providers (AWS, Azure, Google Cloud) as well as in private/hybrid data centers."
Samana rated the stock as buy and provided a price target of $62.
In addition, the analyst noted that the company is able to serve both legacy and cloud-native customers, and its cloud solutions software is easily adaptable to already existing customers. Such a strong relationship is expected to have strong retention levels and prevent churn. (See Verint Systems Hedge Fund Activity)
In addition, Verint allows its vendors to collect data on their customer interactions, specifically with "Agent Assist," an AI productivity driver. Through investments and M&A, the company is enhancing its all-channel capabilities, making it more attractive to potential vendors.
On TipRanks, Samana is rated as number 363 out of more than 7,000 analysts. His stock picks have been successful 57% of the times and have given him an average return of 34.8% on each.
Amazon
Falling consumer spending and tougher earnings comparisons have hit Amazon (AMZN) shares. However, now that the supply crunch is projected to ease and Amazon's investments in logistics and fulfillment infrastructure are expected to pay off, analysts are back on the train. (See Amazon Risk Factors on TipRank)
Doug Anmuth of JP Morgan is one of the most recent to publish a bullish report that e-commerce trends are accelerating again and having a largely successful holiday shopping season. Furthermore, Amazon Web Services (AWS) still rules the cloud-computing market.
Anmuth rated the stock as Buy and declared a price target of $4,350.
The analyst moderately lowered his estimates for Amazon, but believes the lowered expectations "should help re-risk stocks and AMZN will be a clean story unto itself by 2022." " Notably, he expects the company's e-commerce segment to benefit this year on account of annual expansion in transportation and distribution channels.
Amazon has never been so close to so many of its customers.
The company, which is "well positioned as a market leader in e-commerce and the public cloud," could also increase Prime membership prices and fulfillment fees. In turn, these moves will lead to an increase in revenue. Amazon's AWS growth is strong and is considered "sustainable" by Anmuth.
Out of over 7,000 analysts, Anmuth is rated as number 155. It has been the correct rating stock 62% of the time and its ratings have given an average return of 32.4% each.
Tesla
Although Tesla (TSLA) is already considered the leading electric vehicle maker, the company is now going after market share from more established original equipment manufacturers. That means it will be important over the next two years to see where the firm stands relative to legacy automakers -- and less so than smaller EV companies, according to Jefferies' Philippe Houchois.
Analysts are more concerned with Tesla's future ability to succeed this way. He believes that accelerating production will be the main catalyst for the company. Indeed, with its new Gigafactories in Austin and Berlin, the company expects to add meaningful supplies in February and April, respectively. (See Tesla Stock Chart at TipRank)
Houchois gave Tesla a buy status and assigned a bullish price target at $1,400 per share.
The EV maker has seen its order backlog climb to considerable levels, leading Haukois to say that "filling that capacity is not a given". However, the long list of unfinished orders provides confidence in long-term demand and revenue for TSLA.
In addition, the analyst wrote that Tesla has "the business model set to generate cash faster than it can possibly add product and capability."
Houchois is looking at Tesla's quarterly earnings results on January 26. The firm can validate its strong profits and provide updates for Cybertruck or more affordable sedan models.
The analyst is ranked 244th out of more than 7,000 professional analysts. He maintains a success rate of 70% and returns an average of 41.9% on his choices.
VMware
Indicators could point to a breakout for shares of cloud-computing company VMware (VMW). (See VMware earnings date and report at TipRank)
Brian White of Monness details several reasons why the stock could rally. He highlighted the company's "unique value proposition in the cloud" as well as its attractive valuation.
He upgraded the stock from Neutral to Buy and calculated a price target of $153.
White said VMware has "invested in organic innovations, completed acquisitions, and Inked Cloud partnerships." He expects these strategic moves to lay the foundation for its next phase in business performance.
While the company was unable to capitalize on the digital transformation that has benefited many other software firms, the analyst believes VMW's long-term prospects are more solid regardless of the overall trend. For now, he is confident in its market role.
VMware has found a niche in which it is compatible with many established cloud players and maintains a flexible third-party position, the analyst said.
White is currently ranked 111th out of more than 7,000 financial analysts. His stock picks have been 74% successful and have given an average return of 37.1%.
Walmart
Walmart (WMT) appears to have expanded its customer base since the start of the COVID-19 pandemic, and may have the ability to continue to perform despite rising costs of gasoline and inflation. (See Walmart website traffic on TipRank)
Guggenheim's Robert Drubull believes this to be true, writing that Walmart is well positioned to continue making profits despite the challenging environment of consumer spending. He was not worried about inflationary pressures, gas prices and other hardships that arose from the persistence of Covid. However, he pointed to "reckless incentive benefits and the abolition of the child tax credit" as potential negative catalysts.
Calling it one of his "top views," Drubull rated the stock a buy and provided a price target of $185.
He added that as the cost of gasoline goes up for shoppers, they can consolidate their trips to Walmart locations into larger purchases or online purchases. He sees Walmart's physical footprint and online presence as a "winning combination." When costs increase, shoppers can try to save even more by purchasing a variety of products from the retailer.
Analysts remain confident in Walmart's "robust business model" that "could face a potential decline in the consumer spending dollar." He believes in the insulation of the company from disruptive macro forces and trends, and he views the stock price with a favorable risk-reward ratio.
Drobull is ranked 89th out of more than 7,000 analysts by TipRanks. His success rate is 70%, and his stock options have given him an average return of 29.8% each.