The market isn’t looking cheery right now. In between choppy trading conditions and market pullbacks, who knows where to turn for the remaining half of 2018? However, there are still gems to be found. You just have to be more selective, and more active in your research.
In this case, I turned to the market’s top analysts to pinpoint some of the strongest stock ideas going forward. Some of these top stock ideas you know, while others still fly under the general investing radar but are worth a closer look.
I used TipRanks data to ensure that all the following stocks meet the following criteria: 1) A Strong Buy rating from top analysts (i.e., analysts with the highest success rate and average return); and 2) big upside potential. This is how far shares can spike from current levels to the average analyst price target.
So, with this reassurance in mind, let’s now turn to the following 10 top stock ideas right now:
Top Stock Ideas: Health Insurance Innovations (HIIQ)
As the name suggests, Health Insurance Innovations (NASDAQ:HIIQ) sells short-term medical plans. “We continue to believe that HIIQ is positioned to benefit from solid demand for alternative affordable insurance policies. With significant potential upside in the shares, our rating is Overweight” cheered Cantor Fitzgerald analyst Steven Halper recently. This top 100 analyst has a $60 price target on HIIQ, indicating massive upside potential of 85% from current levels.
Two big catalysts on the horizon: resolution of its multi-state review and President Trump’s executive order allowing for the sale of 364-day policies (compared to just three months). And don’t let the recent departure of the company’s chief of product innovation concern you. Halper is confident that the company has “bench strength in the product development area and will continue to work with insurance carriers to develop short-term medical plans.” Plus he notes that Mr. Kosloske will remain a director and significant shareholder post termination.
TipRanks data shows that four analysts have published HIIQ Buy ratings in the last three months. This comes with a $52 average price target (62% upside).
Top Stock Ideas: Twilio (TWLO)
Source: Web Summit Via Flickr
Cloud communications pioneer Twilio (NYSE:TWLO) has a big goal. The company wants to “fuel the future of communications.” In practice, this means that developers can use TWLO’s platform to build SMS, voice and messaging applications. And as companies increasingly value customer interaction, Twilio will reap the rewards.
Right now, the stock is trading at very compelling levels. Top Monness analyst Brian White spies “an attractive entry in this rapidly growing, next-gen software company that we believe is still not well understood.” Meanwhile, Argus’ Jim Kelleher has just upgraded TWLO from Hold to Buy. His new rating comes with a bullish $75 price target (38% upside potential). “As a facilitator of apps that companies can embed in their sites to improve customer interaction, we believe Twilio is in the very early innings of a significant market opportunity,” Kelleher explains.
Most notably, analysts are bullish on the company’s Build platform, part of TWLO’s newly expanded go-to-market efforts. Twilio described Twilio Build as “a partner program [that] delivers go-to-market support, certification and training programs, and a partner success team.” “Twilio Build allows partners to create new businesses that build on Twilio’s innovations in pursuit of disrupting the communications market that Twilio pegs at $1.45 trillion” says White.
With 11 recent buy ratings versus only one hold rating, Twilio has a Strong Buy analyst consensus rating. This is with an average analyst price target of $59.
Top Stock Ideas: Aimmune Therapeutics (AIMT)
This revolutionary biotech is dealing with the notoriously tricky issue of food allergies. “We believe lead drug candidate AR101 is well positioned to become the first FDA-approved treatment for reducing allergic reaction to peanut protein” states Cantor Fitzgerald’s William Tanner. His $64 price target on Aimmune Therapeutics (NASDAQ:AIMT) indicates massive upside potential of 138%.
Data from the pivotal PALISADE trial of AR101 support the drug candidate’s safety and efficacy as a treatment for peanut hypersensitivity, says Tanner. And the company plans to tackle more than just peanuts. Tanner continues “We believe the company’s CODIT technology could be useful for developing other food allergy treatments and we note that AIMT plans to file an IND for egg allergy by YE18 and initiate clinical testing in walnut allergy in 2019.” However, as peanuts represent the most prevalent food allergy, this remains the biggest potential money-maker.
Right now, our data shows that AIMT boasts 100% Street support. This is with five recent buy ratings, and no hold or sell ratings. Plus, the average analyst price target of $56.60 suggests 104% upside potential.
Top Stock Ideas: T-Mobile US (TMUS)
T-Mobile (NYSE:TMUS) is the third-largest wireless carrier in the U.S. According to five-star Oppenheimer analyst Timothy Horan, it has captured 100% of the industry growth since 2013. He explains that these share gains have come from both a greatly improved network, and an innovative marketing strategy that focuses on under-served urban and rural communities:
“We believe the key to the stock’s performance lies in improved network (lower churn), innovative marketing, expansion into rural areas and cost controls, while at the same time trying to leverage its 4G advantage versus its prepaid competitors”, writes Horan. He has an extremely bullish price target on TMUS of $90, indicating over 50% upside potential from current levels.
The big catalyst on the horizon now is the mammoth $146 billion merger between Sprint and TMUS. This could generate synergies of $6 billion. Analysts are becoming increasingly optimistic that the deal will receive regulatory approval. Most notably, Wells Fargo’s Jennifer Fritzsche has just upgraded TMUS from Hold to Buy. She states that recent conversations with DC contacts have made her more optimistic that a deal could be approved.
Nonetheless, even without Sprint (NYSE:S), the stock still has big support. Our data reveals that TMUS has received five consecutive buy ratings in the last three months. Their $79 average analyst price target works out to 33% upside potential.
Top Stock Ideas: Albemarle (ALB)
Albemarle (NYSE:ALB) is the world’s No. 1 lithium producer. Lithium is a key component of automotive batteries, which means this is a stock with massive growth potential. “We expect ALB to benefit from its No.1 position in the lithium market as the transportation industry moves toward BEV/PHEVs on its way to autonomous vehicles along with the affordability of grid-tied stationary energy storage,” cheers top Oppenheimer analyst Colin Rusch.
He is forecasting 12-17% revenue CAGR target for ALB’s lithium business specifically. And this should enable ALB to meet its targeted overall revenue growth of 7-10%. This is with adjusted EBITDA margins of 32-35% over the next five years. “We believe that ALB deserves a premium multiple given the multi-year growth opportunity we see in lithium,” he advocates. Indeed, Rusch sees ALB prices shooting up 65% to hit $157. This is vs the Street’s $128 average analyst price target (38% upside potential).
In total, ALB has received an impressive seven back-to-back Buy ratings in the last three months.
Top Stock Ideas: Zayo Group (ZAYO)
Zayo Group (NYSE:ZAYO) is the undisputed leader of the dark fiber world. This unused fiber can be purchased or leased to create a privately operated optical fiber network. It is the largest provider of dark fiber in the U.S. and targets large enterprise customers who need 10 Gigabit+ connections.
According to top Oppenheimer analyst Timothy Horan: “Zayo has unique bandwidth (fiber/datacenter) infrastructure assets derived from over 30 acquisitions and consistently high CAPEX spending.” Furthermore, “cloud adoption and digitalization are forcing larger enterprises to upgrade their networks, and we view 5G as a long-term driver for Zayo’s fiber assets.” He has a $42 price target on the stock (13% upside potential).
Two other bullish factors to bear in mind: 1) the company has just announced a six-month share repurchase program up to $500M; and 2) Horan believes there is a 90% probability ZAYO will become a REIT within 20 months. The share buybacks, combined with improving organic growth and margin expansion, should lift Zayo’s normalized EPS to $1.06, from $0.99.
In total, five analysts published Buy ratings on ZAYO in the last three months. This is with a $43 average price target.
Top Stock Ideas: Facebook (FB)
There are many reasons to like Facebook (NASDAQ:FB) stock, but one of the most exciting is undoubtedly Instagram. This popular photo sharing app is seeing a meteoric rise, and the Street is paying attention. Most recently, Wells Fargo analyst Ken Sena noted that Instagram Stories recently surpassed 400mm daily active users (DAU).
This means there is big revenue potential ahead: “Our forecast assumes IG Stories can reach Snapchat’s current level of monetization by 2020E, adding $4bn in incremental revenue to IG alone. Meanwhile, assuming IG feed can grow monetization at a 31% CAGR through 2020E, we see over $20bn in combined revenue between the two.” So welcome to the jackpot.
Most encouragingly, he believes that this growth won’t cannibalize FB’s own offering. He notes that ROIs (return on investment) remains healthy on both platforms and that FB is still very attractive to advertisers. “In addition, we would point to the simultaneous growth in both FB and IG engagement over the last several years as indicative of users’ support for >1 platform,” concludes Sena.
He has a Buy rating on the stock and ramps up his price target from $230 to $250. This suggests big upside potential of almost 30%. Out of 29 analysts polled in the last three months, 27 are bullish with only 1 hold rating and 1 sell rating. These analysts have a $222 average price target on FB (15%).
Top Stock Ideas: MiRagen Therapeutics (MGEN)
If you are looking for a cheaper stock pick, take a closer look at this groundbreaking biotech. MiRagen Therapeutics (NASDAQ:MGEN) is a tiny clinical-stage biotech developing microRNA-based therapies for cancer and other diseases. This involves modulating the molecules that regulate gene expression.
Right now, MiRagen has a pipeline of four experimental clinical therapies. The most advanced drugs are currently cobomarsen (for blood cancers) and MRG-201 (for pathologic fibrosis). “miRagen’s lead programs (cobomarsen & MRG-201) have established clinical proof of concept and demonstrated superior efficacy, safety and tolerability profiles in our view,” exclaims top B. Riley FBR analyst Madhu Kumar.
“We consider miRagen as an attractive investment opportunity in a micro-RNA pipeline with potential for multi-billion dollars in product sales.” And with the company’s huge potential in mind, Kumar reiterated his MGEN Buy rating with a $18.50 price target. This suggests shares can spike by more than 150%.
Overall, three analysts have published buy ratings on MGEN in the last three months. Their average price target works out at $16.83, 136% upside from current levels.
Top Stock Ideas: Noble Energy (NBL)
Texas-based oil and gas stock Noble Energy (NYSE:NBL) boasts lucrative assets in the U.S. and West Africa. These assets account to total proved reserves of 1.9 billion barrels of oil equivalent (BOE) — producing an average of 343,000-353,000 (BOE) per day throughout 2018.
The stock is ready to rally according to SunTrust Robinson’s Welles Fitzpatrick. He has just initiated coverage on Noble with a $42 price target (21% upside potential). Fitzpatrick lists a triple whammy of bullish factors from the company’s low valuation multiple to its stellar growth prospects and high net asset value. These assets include “premier positions in the Wattenberg”, which is fast becoming cash-flow positive, and the Delaware basin (still in growth mode).
And when he factors in the company’s Eastern Mediterranean assets (due to achieve free cash flow positive status in FY20), Noble appears as the cheapest stock in the large-cap group on its enterprise value to EBITDA basis. Out of the eight analysts polled by TipRanks on NBL in the last three months, all eight are bullish. On average, they see shares surging 23% from current levels.
Top Stock Ideas: Alibaba (BABA)
This list of top stock ideas wouldn’t be complete without Alibaba (NYSE:BABA). Alibaba is China’s No. 1 E-commerce platform with 80% online retail share. It also owns China’s No. 1 Cloud platform and top three online video player. Five-star Monness analyst Brian White has just conducted a deep dive into BABA’s sizable cloud opportunity. Not only is BABA rapidly accelerating the pace of its cloud innovation, it also stands to benefit from China’s large IT market ($186bn in 2017) where Cloud adoption remains in the earliest stages vs the U.S.
He estimates AliCloud to have a valuation of over $80 billion, prompting him to boost his price target to $250 from $230. “We view this premium as justified in the face of the company’s clear data scale, leadership in China Cloud, and likely ability to extend such advantage beyond its core businesses to new industries and transaction types,” White explains.
The stock is still one of the hottest stocks out there according to the Street. BABA has received only buy ratings over the last ten months — with 15 buy ratings in the last three months alone. Plus from current levels, analysts are projecting that share prices can soar by almost 35%.
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