The most successful investors use all of the tools and resources that are available to them in order to make the best possible decisions. That includes keeping track of analyst reports and looking at which companies consistently receive upgrades and price target increases.
While simply buying a stock because an analyst likes it isn’t usually the best way to approach investing, we can still use these evaluations to gain more conviction in companies that we are considering holding for the long term.
It can be difficult to take note of all of the different upgrades that are occurring each and every day, which is why we’ve put together a list of 3 stocks to buy that analysts love.
Each one of these stocks has recently received multiple upgrades or price increases and could be worth a look at this time.
Let’s take a deeper look below.
1. Children’s Place
Retail stocks have been heating up in 2021, given the widespread distribution of vaccines and stimulus payments going out to households all over the country. That’s likely a big reason why analysts are fans of this specialty retailer, Children’s Place Inc (NASDAQ:PLCE).
As you might have gathered from the name, this company is a pure-play children’s specialty apparel retailer in North America. It designs and sells merchandise under brand names like The Children’s Place, Baby Place, and Gymboree and had 724 stores in the U.S., Canada, and Puerto Rico as of May 2021.
The Children’s Place just reported solid Q1 earnings that confirm it is benefitting from many of the strategic moves that were made last year during the pandemic, including the acceleration of the company’s digital business.
The company reported a Q1 net sales increase of 70.6% year-over-year to $435.5 million and saw its Q1 GAAP earnings per diluted share swing from a loss of $(7.86) in 2020 to $3.01 in 2021. As more kids head back to school and people get more comfortable with shopping in public again, investors can expect The Children’s Place to benefit in a big way.
2. Applied Materials
Another analyst favorite worth buying at this time is Applied Materials (NASDAQ:AMAT) a company that provides manufacturing equipment, services, and software to the global semiconductor, display, and related industries.
You are probably aware of the global semiconductor shortage that is occurring right now, which is something that directly favors this company’s business model.
Keep in mind that Applied Materials has a strong competitive advantage in the chip industry thanks to its broad portfolio of equipment that is used to make almost every type of chip in the world.
Applied Materials received multiple price target increases after reporting very strong Q2 earnings that included record quarterly revenue of $5.58 billion, up 41% year-over-year. The company also delivered quarterly GAAP EPS of $1.43, up 74% year-over-year, and provided strong forward guidance for investors to consider as the chip shortage issue isn’t going away anytime soon.
Management expects momentum to continue into the back half of 2021 and anticipates Q3 revenue to be up 35% year-over-year. Although the market reaction to the earnings news wasn’t all that impressive, keep in mind that the stock rallied up into the release.
Investors should keep an eye on this analyst-favorite stock in the coming days as it looks poised to start the next leg up.
3. GrowGeneration
Cannabis stocks haven’t been in the spotlight lately, but that doesn’t change the narrative surrounding the industry’s upside as more states vote to legalize. One of the best stocks to own if you are interested in playing the “green rush” is GrowGeneration Corp (NASDAQ:GRWG), a stock that recently received multiple analyst upgrades.
GrowGeneration is a farm supply company that owns and operates retail hydroponic and organic specialty gardening retail outlets. As a company that supplies the tools and equipment that cannabis growers need to grow indoors and outdoors, GrowGeneration is certainly poised to benefit from growth in the cannabis industry.
The company’s Q1 earnings were impressive, as GrowGeneration reported record revenue of $90 million, up 173% year-over-year. Comparable store sales for the quarter increased by 51% year-over-year and the company also reported a record EPS of $0.10.
What’s also interesting about this company is the fact that it continues to close acquisitions that increase its number of retail locations across the country.
With ambitions to become something along the lines of “The Home Depot (NYSE:HD) of Cannabis,” this is one cannabis stock that could be a great buy at current levels.