Morgan Stanley has spotlighted several stocks, rated as overweight, that they believe have potential for growth following their recent quarterly earnings. Among these are companies like Robinhood, Toast, Cummins, and Seagate Technology, which have been highlighted as great investment opportunities right now, according to the firm’s analysts.
Angel Castillo, an analyst at Morgan Stanley, is optimistic about Cummins following its recent fourth-quarter performance. The industrial engine company has exceeded expectations, according to him, offering a promising outlook with room for expanding margins and growing revenues. Castillo notes that Cummins is primed for further growth in its engine and power generation segments, adding that the company’s guidance appears conservative, suggesting even more potential upside. Over the past year, Cummins shares have climbed 36%.
In February, Robinhood reported impressive earnings for the fourth quarter, prompting Morgan Stanley to reaffirm its confidence in the trading platform’s shares. Analyst Michael Cyprys expressed increased confidence in Robinhood’s future growth, highlighting the firm’s clarity on its 2025 product roadmap and strategic goals. He also pointed out that deregulation could expand Robinhood’s opportunities in the cryptocurrency space, envisioning a future rich with catalysts as new initiatives and products roll out. Robinhood shares have surged by 210% over the past year.
Toast, a company specializing in restaurant payment technology, has been named a top pick by Morgan Stanley after its strong earnings report released on February 19. Analyst Josh Baer praises Toast’s consistent execution and the broader opportunities it is tapping into, indicating a promising future. Baer is particularly enthused about Toast’s potential for international expansion and its progress in emerging growth markets. Toast shares have risen approximately 70% over the last year, driven by momentum across various growth areas.
Lastly, Seagate Technology has been reiterated as Morgan Stanley’s top pick within the IT hardware sector. The firm remains confident in the continued uptrend of the hard disk drive (HDD) cycle and stronger gross margins, which are expected to lead to positive earnings per share revisions and improved stock ratings. Recent checks in the industry and supply chains bolster their confidence, as demand outpaces supply while cloud spending continues robustly.
