The clouds are gathering on the world economic horizon. As a clear sign that the good times of easy money are over, last week three major central banks – the US Federal Reserve, the Bank of England and the National Bank of Switzerland – all approved interest rate hikes. For the US Federal Reserve, it was an increase of 0.75%, the largest increase since 1994, in response to the news that annual inflation had reached a high of 40+ years, 8.6%.
So how can investors overcome this hostile environment?
A simple answer is, turn to experts. The big investment banks employ executives of experienced, professional stock analysts, who scan the markets looking for the biggest patterns, but also looking for individual stocks that will stand out.
Goldman Sachs, the Wall Street giant, has got its body of analysts to do just that. They have outlined the shares that are expected to show significant gains in the future, although the general market forecasts are declining. We used the TipRanks database to rank some of Goldman’s options and found 3 that the company believes will yield over 40% return next year. Here are the details, along with Goldman’s comment.
Global Online (GLBE)
Goldman’s first choice is Global-e Online, an international e-commerce technology company. Global-e operates an online platform that facilitates e-commerce directly to consumers in cross-border markets. The platform enables merchants to smooth out tax and customs disputes between sellers and buyers and allows retailers to streamline their international customers’ online markets in more than 200 local markets, adapting to differences in languages, currencies, shipping and principles. The company works with corporate clients in the US, Europe and Asia markets.
Global-e made good use of last year’s uptrend. In May 2021, Global-e raised $ 431 million in its IPO. The stock closed the first day trading at $ 25.50 and since then there has been volatile trading, which peaked at $ 81 in September and fell 70% this year alone.
In terms of financial performance, Global-e experienced a rough quarter of the 22nd year. The company’s EPS, with a loss of 35 cents per share, was more than 4 times sharper than the loss of 8 cents last year. Top-line revenue was better, reaching $ 76.3 million, up 65% year-on-year. The company’s gross value of goods (GMV), a measure of what Global-e collects from traders and buyers in every transaction, rose dramatically 71% year-on-year in the first quarter, reaching $ 455 million.
So while profits are falling, businesses are growing. Goldman analyst Will Nance notes in his review of the stock, writing: “While the macroeconomic environment remains highly uncertain, the company believes that low double-digit EBITDA margins, positive free cash flows, an effective customer acquisition model and cosmic The tail winds are likely to support continued growth and investment in the business, even if we see a slowdown in broader spending trends in the second half of the 22nd.
“In addition, the company noted that its continued geographical expansion and diversification, its exclusive strategy to partner with Shopify and the continued market demand seen by the company will continue to lead to strong growth in the coming years,” Nance added.
To that end, Nance believes that Global-e’s potential justifies a market valuation, and the $ 28 price target indicates a one-year upward 43%. (To view Nance’s history, Click here)
Goldman’s view is not extreme in this e-commerce company. The 9 recent GLBE analyst ratings are all unanimous, as Buys, for a strong market consensus. Shares traded at $ 19.57 and the average price target of $ 29.89 is even higher than Goldman Sachs allows – indicating an upward trend of ~ 53% over the next 12 months. (See GLBE stock forecast at TipRanks)
Innoviz Technologies (INVZ)
Innoviz then produces LiDAR systems, an advanced sensor system used in GPS and airborne cartography, topography and topography, but also has applications in navigation and autonomous vehicles. LiDAR systems use advanced laser technology (acronym for “light detection and range”) to act as the eyes of self-driving cars and, together with high-tech artificial intelligence computers, are part of the core technology that will make autonomous vehicles a reality.
Innoviz currently has two LiDAR hardware systems available, the first generation InnovizOne and the second generation InnovizTwo. These products have been tested and used in a range of applications and driving conditions, including robotics, pavement delivery technology, industrial drones and consumer vehicles – as well as heavy trucks, industrial equipment and commercial drones. Both systems are compatible with Level 3-5 autonomous vehicles. Innoviz LiDAR systems can be supplemented with the company’s Perceptions software package.
The company’s next major product, the “next generation” Innoviz360, is in final development for both automotive and non-automotive applications. It is scheduled for marketing in the 4th quarter of this year.
In May of this year, Innoviz made an important announcement – that it has entered into an agreement with one of the world’s largest automotive groups to build LiDAR systems. The deal raised Innoviz’s future order book by about $ 4 billion, to a new total of more than $ 6.5 billion. The name of the automotive partner has not been revealed, although Innoviz is currently partnering with BMW in mass production of LiDAR for autonomous 3-5 level vehicles, making it the first LiDAR company to partner with a major automotive industry in the field.
Innoviz is still in the early stages of commercializing its products. The InnovizOne system is showing sales growth and the company expects to see its first InnovizTwo sales later this year. Revenues, although low, are rising. The top line of the first quarter of 22, of 1.8 million dollars was more than double that of 0.7 million dollars last year.
Analyst Mark Delaney covers this stock for Goldman and sees a clear move forward based on the company’s recent contract announcements and its firm foothold.
“Innoviz has experienced strong momentum with commitments since winning the series production program with a world-leading OEM as a first-tier supplier … We continue to believe that its most recent victory underscores its strong market position, as it now has 3 series “Production earns by contributing to a future order book of $ 6.6 billion (significantly higher than other led vendors in the field, although we note that there is a degree of appreciation involved in calculating an order book),” Delaney wrote.
“While the recently announced Level 1 victory represents a significant long-term revenue opportunity, in the medium term Innoviz believes it can generate material revenue in 2023 from both of the series’ two previously announced wins (with BMW and L4 stand-alone bus program), as well as and from final purchases outside the car “, the analyst added.
According to this perspective, Delaney rates the INVZ that shares a Buy and the $ 7 price target implies a one-year uptrend of ~ 69%. (To view Delaney’s history, Click here)
Overall, Innoviz shares are unanimously approved, with 3 markets supporting the consensus on a strong stock market. The shares are trading for $ 4.13 and the average price target of $ 8 indicates an uptrend of ~ 94%. (See INVZ stock forecast at TipRanks)
Adobe, Inc. (ADBE)
Let’s end with one of the most well-known names in software, Adobe. This company has achieved two of the main goals for each company: a solid product line with strong followers and a good brand to support it. Adobe is known as the developer of PDF format, as well as products such as Photoshop, Illustrator and InDesign, which are now available as SaaS offerings through the exclusive Creative Cloud.
In addition, Adobe brought strong revenue and profits. In the second quarter of fiscal year 2022, which ended June 3, the company reported revenue of $ 4.39 billion at a record level, up 14% year-on-year. EPS outside GAAP of $ 3.35 was just above the $ 3.31 forecast and the company’s cash flow from operations reached $ 2.04 billion. It was a good performance from a company that has a history of steady quarterly reports.
In its up-to-date guidance, however, management reduced its 2022 revenue and EPS forecasts. Adobe had previously published year-over-year guidance of $ 13.70 EPS and $ 17.9 billion in revenue. which fell on this report to $ 13.50 EPS and $ 17.65 in revenue. The decline has frightened investors, at least temporarily.
Covering Adobe for Goldman Sachs, 5-star analyst Kash Rangan was not too bothered by the reduced guidance. He believes Adobe will continue to deliver goods in the long run and wrote: “Despite navigating additional FX winds, we continue to believe in the strength of the underlying business, which is in strong demand and has a robust operating model. We believe that Adobe is well on its way to doubling LT speeds, potentially entering the top ranks of software companies to reach $ 40 billion + revenue.
Rangan did not just write an optimistic outlook. backed it with a Buy rating and a $ 540 price target that showed its confidence in a 48% uptrend for next year. (To view Rangan’s history, Click here)
Tech giants like Adobe have no problem with analyst reviews – and there are 25 such reviews for ADBE shares. They are broken down into 20 Buys and 5 Holds, for a strong buying consensus. The stock is currently trading at $ 365.33 and has an average price target of $ 472.58, indicating a potential one-year gain of ~ 30%. (See Adobe stock forecast at TipRanks)
To find good stock trading ideas at attractive prices, visit TipRanks’ Best Stocks to Buy, a recently released tool that brings together all of TipRanks stock information.
Denial of responsibility: The views expressed in this article are solely those of the projected analysts. The content is intended for informational purposes only. It is very important to do your own analysis before making any investment.