Best Stock To Buy Tomorrow
March brought a volatile month for investors as the focus turned to the banking sector. A combination of deposit flight and sharply rising interest rates caused several prominent regional banks to fail, but swift action from regulators appears to have stemmed the bank run. Meanwhile, significant value is now on offer across the financial sector. And that's not all. In other sectors, companies saw sharp stock price declines in March, which have created solid entry points for the rest of 2023.
best stock to buy tomorrow
Toronto-Dominion Bank is one of Canada's five dominant banking firms. The bank has made several acquisitions in recent years that have expanded its footprint into the U.S. Due to the limited amount of competition there, Canadian banks tend to earn high profit margins and enjoy more stability than their U.S. counterparts. Regardless, TD stock has fallen sharply over the past month amid the broader banking industry panic.
And herein lies both a challenge and an opportunity for TD. The firm acquired a 13% ownership stake in Charles Schwab Corp. (SCHW) when Schwab merged with TD Ameritrade. Schwab shares plummeted in March amid worries about deposit flight and falling profit margins for the broker. TD, through its ownership stake, will profit from any rebound in Schwab shares as that crisis passes. For now, TD stock is trading at 6.2 times forward earnings while offering a 4.8% dividend yield.
Snowflake is a fast-growing, cloud-based data storage and analytics company. The firm was one of the most anticipated initial public offerings of recent years, going public at $120 per share in September 2020. It attracted notable investors, including Warren Buffett's Berkshire Hathaway Inc. (BRK.A, BRK.B). Snowflake shares would go on to trade above $400 at one point, as traders were drawn to the firm's incredible revenue growth. Now, though, the stock is in a slump, closing at $142.11 per share on March 30 after its latest slide this past month.
Hormel shares slumped in recent months due to margin pressure driven by high input prices. The war in Ukraine, in particular, made grains and livestock more expensive. However, Hormel has a tremendous track record, including more than 50 consecutive years of dividend growth. It should navigate this bump in the road, and investors can buy shares for a discount in the meantime.
Buying a stock is easy, but buying the right stock without a time-tested strategy is incredibly hard. So what are the best stocks to buy now or put on a watchlist? MercadoLibre (MELI), Meta Platforms (META), HubSpot (HUBS), PagerDuty (PD) and Palo Alto Networks (PANW) are prime candidates.
The CAN SLIM system offers clear guidelines on what you should be looking for. Invest in stocks with recent quarterly and annual earnings growth of at least 25%. Look for companies that have new, game-changing products and services. Also consider not-yet-profitable companies, often recent IPOs, that are generating tremendous revenue growth.
Once you have found a stock that fits the criteria, it is then time to turn to stock charts to plot a good entry point. You should wait for a stock to form a base, and then buy once it reaches a buy point, ideally in heavy volume. In many cases, a stock reaches a proper buy point when it breaks above the original high on the left side of the base. More information on what a base is, and how charts can be used to win big on the stock market, can be found here.
A key part of the CAN SLIM formula is the M, which stands for market. Most stocks, even the very best, follow the market direction. Invest when the stock market is in a confirmed uptrend and move to cash when the stock market goes into a correction.
A stock market rally that kicked off 2022 soon fell on its face. The market overall has been choppy since then, with bear market rallies often being undercut by painful drawdowns. While the Nasdaq looks healthy, the S&P 500 has fallen under the 50-day moving average amid challenging action sparked by negative action among bank stocks.
Now is a time to prepare for the next stock market uptrend by creating a robust watchlist. Focus on fundamentally strong stocks coming out of sound chart patterns, such as those in the IBD 50. These names will tend to have rising relative strength lines. The stocks below are good candidates.
Now let's look at MercadoLibre stock, Meta stock, HubSpot stock, PagerDuty stock and Palo Alto Networks stock in more detail. An important consideration is that these stocks all boast impressive relative strength.
MELI stock has surged into first place in IBD's competitive Retail-Internet industry group. Other high fliers include China e-commerce giant Pinduoduo (PDD) and Etsy (ETSY).
Lackluster earnings are reflected in an EPS Rating of 48 out of 99. Despite this, growing bullish sentiment is reflected in the fact it is in the top 4% of stocks in terms of price performance over the past 12 months.
Encouragingly, the stock has been getting support at its 21-day exponential moving average and recently found support at the 50-day/10-week line. IBD research has found that big stock market winners tend to find support at the 21-day after a breakout for at least several weeks.
The word "innovation" gets tossed around too easily these days, but it's a fact that the best stocks over the long haul took an innovative and often disruptive approach in their respective industries.
Don't believe us? Just have a look at the 50 best stocks of all time to see how critical creativity, originality and a commitment to research and development have been to long-term share-price performance.
Indeed, innovation is so important to long-term success that Argus Research has created a model portfolio around the concept. The Argus Model Innovation Portfolio comprises 30 companies the independent research firm sees as being among the best stocks to buy today for outsized gains over the long haul.
Here's how we found Wall Street's favorite stocks in the Argus portfolio: S&P Global Market Intelligence surveys analysts' stock recommendations and scores them on a five-point scale, where 1.0 equals a Strong Buy and 5.0 is a Strong Sell. Any score below 2.5 means that analysts, on average, rate the stock as being Buy-worthy. The closer a score gets to 1.0, the stronger the Buy recommendation.
Read on to see the Street's favorite stocks in the Argus Model Innovation Portfolio. If the analysts are right, these are some of the best stocks to buy today to profit from where their innovative thinking is taking them tomorrow.
In July, Analog Devices, which specializes in a range of circuits used in virtually all types of electronic equipment, announced a deal to buy Maxim Integrated Products in an all-stock transaction valued at about $21 billion.
"ADI continues to experience recovery in key end markets including automotive (up 40% sequentially) and diversified industrial," writes Argus Research analyst James Kelleher, who rates the stock at Buy. "We look for ongoing strength in communications infrastructure as the 5G network rollout continues."
Of the 24 analysts covering the stock tracked by S&P Global Market Intelligence, 12 rate ADI at Strong Buy, seven say Buy, four call it a Hold and one says Sell. They expect the company to generate average annual EPS growth of nearly 11% over the next three to five years. They also give it an average price target of $179.43, which gives ADI stock implied upside of about 17% in the next year or so.
The pros expect the chipmaker to generate average annual earnings-per-share (EPS) growth of more than 18% over the next three to five years. Their average target price of $635.62 gives NVDA stock implied upside of about 24% in the next 12 months or so.
Of the 26 analysts covering the stock tracked by S&P Global Market Research, 12 rate it at Strong Buy, nine say Buy and five call it a Hold. You can chalk the optimism up to Adobe's rock-solid market position and a history of setting the cutting edge.
BlackRock (BLK (opens in new tab), $757.86) is probably best-known to retail investors for its hundreds of iShares exchange-traded funds (ETFs). It also happens to be the world's largest asset manager, with $8.7 trillion in assets under management at the end of 2020.
Several other pros consider BLK among the best stocks to buy today. Eight analysts rate it at Strong Buy, six say Buy and three call it a Hold, according to S&P Global Market Intelligence. They project BlackRock's shares to deliver average annual EPS growth of more than 13% over the next three to five years.
UBS Global Research, for one, counts itself among the bulls. "Given attractive market opportunities, we expect BLK to reinvest the savings from greater efficiency and pandemic-related cutbacks into product, distribution and technology," writes UBS analyst Brennan Hawken, who rates the stock at Buy.
"The company is well positioned for future trends such as climate change and energy market disruption, 5G deployment, and automation in manufacturing," writes Argus Research analyst John Eade, who rates the stock at Buy.
"Simply put, PayPal should continue to benefit from the secular shift to e-commerce that should drive a roughly 20% revenue compound annual growth rate (CAGR), which, coupled with margin expansion and capital allocation (mergers & acquisitions plus stock buybacks), should result in an earnings CAGR north of 20% over the next several years," writes Raymond James analyst John Davis, who rates the stock at Overweight (the equivalent of Buy).
The pros broadly agree that PYPL is among the best stocks to buy today for tomorrow's technologies. Twenty-eight analysts tracked by S&P Global Markets Intelligence rate PayPal stock at Strong Buy, while 11 call it a Buy, versus just six Holds and one Strong Sell. The Street forecasts the company to deliver average annual EPS growth of almost 22% over the next three to five years. 041b061a72