Opportunity knocks but once, goes the old saw, and the trick is making sure you hear it. That’s certainly true in the investing world, where it can sometimes be difficult to identify the stocks most likely to show near-term growth. This is where TipRanks steps in.
TipRanks assembles a comprehensive database of stock performance information, based on the market movements of 6,400 publicly traded companies. And in all of this information, it’s possible to find the upgrades.
Upgrades happen when an analyst revises his view of a stock – and bumps it up. Sometimes it’s in response to a particularly good quarter, sometimes to a merger or an acquisition, or sometimes the analyst saw a hint that good times are in store. Investors should be alert, to take notice and be ready to act when top analysts upgrade a stock.
Here, we highlight three stocks that received some upgrade love today.
This company is well-known, almost a household name, and definitely a staple for online marketers. Salesforce was an early leader in the cloud computing sector, and quickly became a leading name in Customer Relationship Management (also CRM, like the ticker). The company’s products include cloud-based subscription software for tracking sales and commerce, databases, marketing efforts, customer service, and business analytics.
Salesforce is the largest of the companies in this list, with a market cap of $153 billion – up almost 11% in the past month. Company management has set a goal increasing total revenues from FY2019’s $13 billion to $34 billion by 2024. The most recent quarterly report, for calendar Q3 2019, showed that CRM is on track toward this goal – the $4.5 billion top-line revenue beat the forecast, as did the 75-cent EPS figure.
The upgrade on Salesforce came from RBC Capital analyst Alex Zukin. Zukin holds 5 stars from TipRanks, and is ranked #29 overall in the analyst database.
On Salesforce, Zukin had already rated the stock a Buy, but now he’s made the stock one of his Top Picks. Supporting his increased optimism, Zukin writes, “We think that Salesforce continues to grow cRPO >20% and that there are many avenues to sustain growth, including service and marketing, the platform, and international and future initiatives… we think Salesforce can continue to drive premium growth for its size and it remains an important strategic asset.”
Along with the upgraded stance, Zukin also raised his price target on the stock to $215, suggesting an upside of 24% for CRM. (To watch Zukin’s track record, click here)
All in all, Salesforce gets a Strong Buy rating from the analyst consensus, based on no fewer than 24 Buys against a single Hold. Shares currently sell for $172, and the average price target of $192 indicates an upside potential of 11%. (See Salesforce stock analysis at TipRanks)
Mack-Cali Realty Corporation (CLI)
Headquartered in New Jersey, and operating throughout the Garden State and the Northeast, Mack-Cali is a Real Estate Investment Trust (REIT) focused on commercial properties, mainly office space. The company owns, manages, and leases its properties, and has recently begun diversifying into the apartment complex segment.
Like most REITs, CLI pays out a reliable dividend. The payment, which has held steady at 20 cents quarterly since July 2017, is unusual for the REIT sector for its relatively low payout ratio of 52%. The yield, at 3.5%, is almost double that of the average S&P-listed company.
The Q3 earnings were decidedly mixed for CLI – FFO, or funds from operation, was down year-over-year at 38 cents, and while top-line revenue showed a yoy gain to $131.9 million, it still missed the forecast. Share values started sliding after the earnings release. The stock made a turnaround at the end of December, however, regaining its losses – and more. In the first few sessions of 2020, CLI shares managed a modest gain of 1.64%.
Analyst Steve Sakwa, reviewing the stock for Evercore ISI, sees plenty of reason for optimism in this stock and upgrades his view from Neutral to Buy. Backing his bullish stance, Sakwa writes, “We are upgrading CLI to Outperform from In Line and increasing our PT to $27 from $24 as a result of (i) rising confidence that CLI will be able to sell their entire suburban office portfolio in a reasonable time frame and (ii) our conviction that CLI’s sale of their suburban portfolio will cause a re-rating in the stock due to simplification and a higher quality portfolio that could be monetized more easily.”
In addition to upgrading his rating on the stock, Sakwa also raised his price target by $3, to $27. His new price target implies an upside of 15%. (To watch Sakwa’s track record, click here)
Despite the recent upgrade, CLI shares still get a Hold from the analyst consensus. The stock has received 3 Buys, 1 Hold, and 2 Sells from Wall Street’s analysts in recent weeks. The average price target is $27, suggesting a 7.3% upside from the current trading price of $23.45. (See Mack-Cali’s stock analysis at TipRanks)
EVO Payments, Inc. (EVOP)
Online finance is a major business niche, and EVO Payments is a small but rising player in it. The company is an electronic payment processing provider, offering merchants services for digital payment acceptance and transactions. EVO also offers fraud and loss prevention services. The company operates in over 150 countries around the world.
EVOP shares started the New Year with a 4% gain in the first few trading sessions. These gains come after losses in December, and will hopefully augur better times ahead. On another positive note, the Q3 earnings report, released in early November, showed a bottom-line EPS of 19 cents, solidly above both the forecasts and the year-ago number. This came despite a top-line revenue miss.
This stock underperformed in 2019, but BTIG analyst Mark Palmer, rated 5-stars and #41 overall in the TipRanks database, sees reason for optimism. He points out that EVOP has a “solid growth profile, potential for margin expansion, and its scarcity value as a relatively small merchant acquirer in a consolidating payments market.” Palmer sees EVOP’s recent share price decline as opening up a buying opportunity.
Palmer puts a $32 price target on this stock to go with his Buy rating. This shows his confidence in 17% upside growth in the next 12 months. (To watch Palmer’s track record, click here)
"We are bullish on EVOP’s prospects in 2020 and beyond for several reasons including its growth opportunity in the high-growth B2B payments space in which it is differentiated based on its focus on the less competitive accounts receivable payment area (versus the more competitive accounts payable area) and its software integrations with several major enterprise resource planning (ERP) providers," the analyst added.
EVO Payments get a Moderate Buy rating from the analyst consensus, based on 2 Buys and 3 Holds set in the past three months. Shares are currently selling for $27.43, and the average price target of $29.60 suggests a modest upside of 8%. (See EVO Payments’ stock analysis at TipRanks)
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