Investors entered 2022 in a whirlwind of uncertainty, including the Federal Reserve’s decision to tighten monetary policy, rising inflation and tensions between Russia and Ukraine.
Indeed, these factors so destabilized the market that the major indices ended the previous week firmly in negative territory.
Finding long-term stock picks in this new era can be difficult; TipRanks, a financial data aggregation website, offers investors the information they need to navigate these turbulent times.
Here are five stocks that some of Wall Street’s top analysts value over the long term.
This earnings season proves the performance and execution of semiconductor stocks. ON Semiconductor (TO) released strong quarterly results and raised its guidance, but analysts were more excited about its gross margin expansion. (See ON Semiconductor revenue data on TipRanks)
Susquehanna’s Christopher Rolland is one such optimistic voice, expressing that ON “remains one of our strongest names, due to their constructive setup and history of helping each other.” The semiconductor manufacturer’s segments were accelerated by strong action in the automotive and industrial end markets.
Rolland priced the stock long and raised his price target from $65 to $75.
The analyst added that ON management expects the company’s silicon carbide (SiC) business to double this year and next. SiC is a more advanced compound than typical silicon, and is widely considered the next generation of chip technology.
Stating that the company “is transitioning from a basic energy management provider to a value-added provider in high-growth markets,” Rolland said ON’s prospects will largely depend on its ability to continue manufacturing as efficiently as possible.
The company disposed of unnecessary assets in an attempt to reduce operating expenses, such as with the sale of its Belgian factory.
Of the more than 7,000 analysts in the TipRanks database, Rolland ranks 4th. He was successful 84% of the time when picking stocks and earned an average return of 51.6% on them.
Advertising revenue is essential for many social media platforms. After Apple’s privacy changes, many investors worried about the effect on companies like Snap (BREAK). The stock has traded lower since its October 2021 results and fell precipitously after Meta Platforms released unfavorable results. However, Snap bounced back the next day, seeing strong revenue and high engagement.
Wells Fargo’s Brian Fitzgerald said SNAP saw revenue up 42% year-over-year and daily active users grew 20% over the same period. These numbers are rather impressive compared to the tough late 2020 performance comparisons. (See the snapshot risk analysis on TipRanks)
Fitzgerald priced the stock long, but he lowered his price target to the more modest $60 from $75.
The analyst pointed to the return of SNAP’s core advertising business. Additionally, high levels of engagement were noted across Snapchat’s discovery page, games, and featured features.
The Spotlight feature is intended to be SNAP’s answer to TikTok. It’s been particularly successful in India, where TikTok has been banned altogether.
Assuming Snap “remains well positioned to capture users’ attention,” Fitzgerald sees strong upside potential in a historically small stock.
Fitzgerald is ranked #104 out of over 7,000 financial analysts on TipRanks. He was right on 59% of his grades, and they gave him an average return of 42.4% on each.
Along with the rest of speculative assets, bitcoin has seen its fair share of volatility in recent weeks. The traditional cryptocurrency took a nose dive in mid-January, which further rattled stocks of miners, such as Riot Blockchain (RIOT).
However, this is only a long-term blow. Throughout the quarter, Riot took steps to increase its hash rate — the amount of computing power a network uses to process transactions — and increase its block rewards. (See Riot Blockchain stock charts on TipRanks)
Darren Aftahi of Roth Capital Partners, who explained the details of this development, explained that RIOT’s expansion plans not only include new mining equipment, but also transformers and facilities. All of the company’s heavy investments point to higher bitcoin production and hence higher revenue.
Aftahi priced the stock long and calculated a price target of $46.
Expanding its network has not been without obstacles, as the company has had to overcome shipping delays and installation issues in order to increase its hash rate. Now, Aftahi writes that RIOT expects around 8,000 new machines to become operational this month, along with several high voltage transformers for its plant in Whinstone, Texas.
This move will essentially double the electrical capabilities of the facility.
TipRanks maintains a ranking of #212 for Aftahi, noting its pass rate of 40% and average return per rating of 43.1%.
Although the Spotify technology (PLACE) grapples with the ongoing Joe Rogan saga and artist boycott, the company managed to report quarterly results. Brian White of Monness, Crespi, Hardt & Co has a positive view of the streaming giant.
He mentioned that SPOT is experiencing a strong acceleration in its podcast segment and ad revenue, a move the company has invested heavily in. After more than a week of uncomfortable media coverage, Spotify has pledged to stick with its controversial podcast host, though White isn’t convinced this will be the last controversy surrounding Rogan. (See Spotify website traffic on TipRanks)
Nonetheless, White remains bullish on the stock, labeling it a Buy and adding a price target of $240.
He wrote that Spotify provided wholesome advice. The analyst noted that the company is “riding a favorable secular trend, improving its capabilities, tapping into a large digital advertising market and expanding its audio offerings.” These factors helped the streaming service platform grow its revenue 24% year-over-year, beating its Wall Street consensus estimates.
Along with many technology and growth-related stocks, SPOT has fallen significantly over the past few months. The stock is down more than 30% in 2022, potentially providing potential investors with an attractive entry price on the stock.
Out of more than 7,000 analysts, White is ranked No. 136. He successfully picked stocks 68% of the time and averaged 32% return on his picks.
The worst could be in the rearview mirror for Lyft (LYFT) as states begin to lift restrictions they have placed on the omicron variant. The ridesharing company’s quarterly revenue managed to beat consensus estimates on Wall Street. (See Lyft’s insider trading activity on TipRanks)
Wedbush’s Dan Ives released a report following the earnings release, writing that LYFT has already started to see demand rebound, along with a strong supply of drivers after mild pandemic-related impacts. He maintains that omicron’s challenges have come to a head and the company is poised to move forward now that the difficult quarter is over.
Ives priced the stock as a buy and provided a price target of $50 per share.
The analyst was enthusiastic about Lyft’s performance, noting that the company “generated its first positive EBITDA year as it benefited from strong margin leverage from improved costs.”
In addition to the projected high mobility, LYFT has made vertical investments beyond its core business and has partnered with Delta Air Lines for travel initiatives. Ives discussed a “sticky network” of products for Lyft users, such as its involvement in bikes, scooters, car rentals and Lyft Maps. These types of integrations make it harder for consumers to leave the platform.
On TipRanks, Ives is ranked #178 out of over 7,000 expert analysts. He was correct on his grades 61% of the time, and he averaged returns of 33.3% on each.