As the new year unfolds, investors find themselves navigating a landscape marked by macroeconomic uncertainties, particularly the Federal Reserve’s ongoing concerns about inflation and its implications for interest rates. In these volatile times, strategic investors are looking to strengthen their portfolios by adding stocks with robust financial foundations and promising long-term growth potential. Insights from leading Wall Street analysts can be invaluable in this endeavor, as they provide well-informed perspectives based on a comprehensive understanding of both global trends and individual company dynamics.
Let’s delve into three stocks that are currently favored by top industry professionals, as highlighted by TipRanks, a platform known for ranking analysts based on their performance.
### Uber Technologies
We’re kicking off with Uber Technologies (UBER), a key player in ride-sharing and food delivery services. Despite expectations not fully being met on gross bookings, the company exceeded revenue and earnings projections for Q3 2024.
Recently, James Lee from Mizuho reaffirmed a ‘buy’ rating on Uber, setting a price target of $90. Lee views 2025 as a pivotal year for Uber’s investments, which, while potentially impacting short-term earnings, are likely to bolster long-term growth. Lee predicts Uber’s investment strategy will result in a compound annual growth rate (CAGR) of 16% for core gross bookings from FY23 through FY26, aligning with the company’s own growth targets of mid-to-high teens.
He remains confident in Uber’s EBITDA trajectory, expecting it to hit the high-30s to 40% CAGR by the analyst day target. Lee also believes concerns over the Mobility segment’s growth are exaggerated and anticipates more tempered deceleration in gross bookings growth by 2025 compared to late 2024.
Additionally, Lee forecasts mid-teen growth for Uber’s Delivery business in FY25, driven by increased adoption across new verticals. Checks by Mizuho further revealed record-high order frequency and strong grocery service uptake in the US, Canada, and Mexico.
James Lee is ranked 324th among over 9,200 analysts tracked by TipRanks, boasting a 60% success rate with an average return of 12.9%. Check out Uber Technologies’ stock charts on TipRanks for more insights.
### Datadog
Next, we have Datadog (DDOG), known for its cloud monitoring and security solutions. In November, the company presented impressive Q3 2024 results, exceeding expectations.
On January 6, Brian White from Monness confirmed a ‘buy’ rating on Datadog, with a price target of $155. White appreciates Datadog’s balanced approach towards AI trends, contrasting with some exaggerated claims in the software sector. Despite 2024’s challenging software market, DDOG outperformed compared to its peers, albeit lagging in Monness’ broader stock coverage.
White anticipates a surge in activity over the next 12 to 18 months, driven by generative AI advancements. He highlighted DDOG’s performance and transparency in AI development, noting an increase in AI-native customer contribution to annual recurring revenue from Q2 to Q3 2024.
The analyst commends Datadog’s AI offerings, such as LLM Observability and Bits AI, expressing optimism for Datadog’s privileged valuation due to its cloud-native platform, quick growth, and formidable trends in the observability space, coupled with its new growth avenues in AI.
Ranked 33rd among over 9,200 analysts on TipRanks, Brian White has achieved a 69% profitable rating success, yielding an average return of 20%. See Datadog’s ownership structure on TipRanks for further details.
### Nvidia
Finally, we turn to Nvidia (NVDA), a key player in the semiconductor industry, thriving amid the AI surge with its cutting-edge GPUs essential for AI model development.
Following a discussion with Nvidia’s CFO Colette Kress, JPMorgan’s Harlan Sur reiterated a ‘buy’ rating with a $170 price target. Sur highlighted assurances about the company’s Blackwell platform expansion staying on course amidst supply chain challenges, supported by effective execution.
Furthermore, Nvidia anticipates robust data center spending into 2025, bolstered by Blackwell’s initiation and strong demand. Sur emphasized the management’s optimistic outlook on revenue growth as the company secures a significant portion of the expansive $1 trillion datacenter infrastructure market.
Sur also noted Nvidia’s projections of benefiting from the shift to accelerated computing and rising AI demand, pointing out the company’s strategic edge over ASIC solutions in terms of ease of adoption and comprehensive system solutions. He concurs, asserting that customers will continue preferring solutions powered by Nvidia.
Harlan Sur is ranked 35th on TipRanks out of over 9,200 analysts, with a 67% success rate and average returns of 26.9%. Explore Nvidia’s hedge funds activity on TipRanks.
These insights from top analysts provide a solid foundation for informed investing, even in the face of economic uncertainty, by highlighting companies with strong potential and promising market positions.
