Netflix, Expedia & Microsoft: 3 Trending Stocks Ready For Take-Off
While Amazon (Nasdaq:AMZN) and Apple Inc. (Nasdaq:AAPL) have undeniably eclipsed the headlines this week, I took to the Street to shine the spotlight on other large-cap stocks ready for take-off.
Now let’s unravel what makes these 3 trending stocks so exciting right now:
Netflix (Nasdaq:NFLX)
Streaming giant Netflix is soaring right now. The company- which is dominating the field of online video- has seen its price explode from just $211 in January to $291 in April. This is on the back of blockbuster first quarter earnings. Indeed, Wedbush analyst Michael Pachter hailed the company’s first quarter earnings report a ‘bullish blowout quarter that included a best-ever rise in streaming revenue’.
JP Morgan Analyst Doug Anmuth recently hiked up Netflix’s price target forecast from $328 to $385 following ‘another impressive quarter’. He told investors that ‘Netflix’s content strength and the global, secular shift to Internet entertainment are driving subscriber upside’. Plus the company continues to execute “extremely well,” with Anmuth emphasizing its case as the best global, secular growth story in technology.
Despite the stellar revenue, Wedbush analyst Michael Pachter is ultimately cautious on Netflix. This is due to its growing ‘cash burn’ and a ‘need to raise subscription prices’. He says he expects Netflix ‘to burn cash for many years as it continues spending vast sums on content’.
Overall, our data shows that Netflix has a cautiously optimistic Moderate Buy analyst consensus rating. Out of 31 top analysts, 19 rate the stock a buy, while 12 rate the stock a hold. Analysts are, on average, forecasting 10.5% upside potential from the current share price.
Expedia (Nasdaq:EXPE)
International online travel specialist, Expedia Group is a major player in the hospitality, advertising and travel industries. In recent years the booking giant has expanded to provide services to consumers and corporate globetrotters alike through its travel business, Egencia.
In Q1 shares plummeted to a record low of $98 due to extreme weather and a series of company setbacks. However, Expedia is now back on the path to recovery. In fact, the current share price has jumped in the last month to peak at around $115. Expedia also has a relatively bullish ‘Moderate Buy’ forecast from the Street, with an average price target projection of $136 for the next 12 months. This translates into 19.29% upside potential from the current share price.
Top-performing analysts such as Wells Fargo’s Peter Stabler maintained a Buy rating on Expedia with a price target of $135. Stabler is a 5-star rated analyst with an average return of 29% and a 79% success rate. He stated: ‘management called out a series of investments which weighed on 1Q margins’ and are ‘driving positive early contributions to the business’.
Stabler is hopeful that ‘growth in R&D, investments…will drive operational improvements and improved capital efficiency over time.” He also sees accelerating revenues for Egencia—EXPE’s corporate travel business, driven by growth in client signings and an expanded sales team.
Meanwhile, Brad Erickson from KeyBanc raised his price target from $125 to $140. He has an Overweight rating on Expedia shares. Erickson reinforced how Expedia’s Q1 results were ‘solidly better than feared’ as he believes data providers released estimates which ‘skewed sentiment as way too negative.’ He noted that ‘Q2 room-night comps are stronger’ and ‘the setup for hotel additions remains favorable’.
Microsoft Corp (Nasdaq:MSFT)
The last of our trend-setting large-cap stocks is the multinational software giant, Microsoft. Best-known for its flagship products like Microsoft Windows software or its ingenious Xbox video game consoles, the US-based tech corporation specializes in computer software but is also a key player in the cloud.
Barclays analyst Raimo Lenschow recently raised the Microsoft price target from $100, with an Overweight rating on the shares. He told investors that the company ‘has put up another good quarter and continues to execute well with all three segments beating consensus estimates. Microsoft is becoming a predictable growth story that will continue to provide positive estimate revisions says Lenschow.
Microsoft also has the backing from other top analysts with a ‘Strong Buy’ analyst consensus rating. As we can see from TipRanks data for 18 Top- Performing analysts, the average price projection for the next twelve months is $109, up from $80 in December. Although Microsoft slightly dipped in April, the forecast is looking good and translates to a 16.83% upside potential, with a high estimate of $130 and a low estimate of $75.
Disclaimer: TipRanks is an independent cloud based service that measures and ranks digitally published financial advice. TipRanks' natural language processing (NLP) algorithms aggregate and ...
more