Artificial intelligence (AI) could transform the way the world works. In some ways, this could be positive. For example, AI already is helping researchers more quickly screen molecules for new drugs. This could lead to better treatments -- and faster development of them. AI also
For Immediate ReleaseChicago, IL – July 20, 2023 – Zacks Director of Research Sheraz Mian says, "For the 50 S&P 500 companies that have reported Q2 results, total earnings are up +4.4% from the same period last year on +8.6% h
Publicis, one of the world's top advertising groups, on Thursday slightly raised its full-year targets after posting 7.1% organic revenue growth in the first half, helped by its shift towards digital marketing.
Offering world's cheapest Domino's pizza at 49-rupee ($0.60) in India, Domino's No.1 market outside America, the strategy seems to be the tip of the spear in their fight against rampant inflation that's squeezing profits and pricing out many customers, according to the CEO of its franchisee there.
Note: The following is an excerpt from this week’s Earnings Trends report. You can access the full report that contains detailed historical actual and estimates for the current and following periods, please click here>>>
Note: The following is an excerpt from this week’s Earnings Trends report. You can access the full report that contains detailed historical actual and estimates for the current and following periods, please click here>>>
The White House on Wednesday expanded its war on junk fees to the rental housing market, announced a crackdown on price-fixing in food and agricultural markets, and unveiled draft merger guidelines as part of an ongoing push to aid U.S. consumers.
U.S. antitrust regulators published guidelines on Wednesday on the kinds of mergers and acquisitions they object to, reaffirming the skepticism with which President Joe Biden's administration has approached many deals, especially in the technology sector.
The
SPDR S&P 500 ETF Trust (
SPY)
and
Invesco QQQ Trust (
QQQ)
are among the widely-discussed
ETFs (exchange-traded funds) on the popular social media platform Reddit. While these ETFs are buzzing on Reddit and have significantly gained mentions, their recent rallies give them limited upside potential (based on analysts’ price targets on their holdings).
But before we dig deeper into these buzzing Reddit ETFs, let’s understand how TipRanks determines the ratings and price targets on ETFs.
How Does TipRanks Determine Analyst Ratings on ETFs?
TipRanks leverages its proprietary technology to calculate the consensus analyst forecast and price targets for ETFs by taking all their underlying assets into consideration. At a glance, you will see the overall analyst rating, analyst price target, and upside or downside on an ETF.
Innovatively, TipRanks calculates a weighted average number based on the combination of all the ETFs’ holdings. For instance, the average price forecast for an ETF is calculated by multiplying each holding’s price target by its weight (allocation) in the ETF.
Is SPY ETF Good to Buy Now?
SPY is one of the most popular ETFs to diversify risk and earn steady returns. For instance, the SPDR S&P 500 ETF has the S&P 500 Index (
SPX
) as the benchmark and aims to provide similar returns.
Impressively, the ETF is highly diversified, offers exposure to 24 separate industry groups, and primarily focuses on
large-cap stocks. Meanwhile, it has delivered an average annualized return of 12.72% in the past decade with a
low expense ratio of 0.09%, which makes it a compelling long-term investment.
While SPY is an attractive investment, investors can wait for a better entry point. SPY has gained about 20% year-to-date. Thanks to the recent gains, SPY is trading at a forward price-to-earnings multiple of 20.74, which appears expensive given the estimated EPS growth forecast of 12.48% over the next three to five years.
Yes, the SPY ETF has an
Outperform Smart Score of 8 out of 10 on TipRanks. However, per the recommendations of 6,294 analysts giving stock forecasts for
SPY's holdings, the 12-month
average SPY price target of $485.53 implies limited upside potential of 6.9% from current levels. Also, the SPY ETF carries a Moderate Buy consensus rating on TipRanks.
Among the analysts providing ratings on its holdings, 59.60% have given a Buy rating, 35.02% have assigned a Hold rating, and 5.39% have given a Sell rating.
Is QQQ Stock a Buy or Sell?
The recovery in mega-cap
technology companies has led to significant growth in the QQQ ETF. For instance, QQQ has gained over 45% on a year-to-date basis, led by the rally in the shares of its
top five holdings, which are Microsoft (
NASDAQ:MSFT
), Apple (
NASDAQ:AAPL
), Nvidia (
NASDAQ:NVDA
), Amazon (
NASDAQ:AMZN
), and Tesla (
NASDAQ:TSLA
).
Together, its top five holdings account for 43.53% of its total holdings, implying that its performance is highly dependent on them. While these tech giants are poised to deliver strong growth in the long term, their recent rallies and valuation concerns could restrict their upside potential in the short term. This is well reflected in analysts’ price forecast for QQQ over the next 12 months.
According to the recommendations of 1,730 analysts giving stock forecasts for
QQQ's holdings, the 12-month
average QQQ price target of $396.72 implies a mere 2.85% in upside potential from current levels.
Nonetheless, QQQ ETF, which has the Nasdaq-100 index (
NDX
) as its benchmark, sports an
Outperform Smart Score of 8 out of 10 on TipRanks. It has consistently outperformed the broader markets and delivered solid returns. However, the recent run in its price is keeping analysts cautiously optimistic.
QQQ ETF has a Moderate Buy consensus rating. Among the analysts providing ratings on its holdings, 66.53% have given a Buy rating, 29.71% have assigned a Hold rating, and 3.76% have given a Sell rating.
The Bottom Line
Both these buzzing Reddit ETFs look like solid long-term investments for investors seeking exposure to top companies with relatively lower risk. SPY and QQQ offer diversification and consistently deliver attractive returns. However, both these ETFs have gained quite a lot, which limits their upside potential.
Disclosure
The past three years of the public health crisis have significantly altered the structure and trend of the Retail - Pharmacies and Drug Stores industry. On a positive note, amid acute supply-chain disruption and staffing shortages
A French-led backlash led to a U.S. economist withdrawing from a top European Union antitrust job on Wednesday, a move some economists said risks undermining competition policy-making.
EU antitrust regulators have extended their deadline for a decision on Amazon's $1.7 billion acquisition of robot vacuum cleaner maker iRobot to Dec. 13 after the companies requested more time.
Below is Validea's guru fundamental report for AMAZON.COM, INC. (AMZN). Of the 22 guru strategies we follow, AMZN rates highest using our P/B Growth Investor model based on the published strategy of Partha Mohanram. This growth model looks for low book-to-market stocks that exhi
Below is Validea's guru fundamental report for AMAZON.COM, INC. (AMZN). Of the 22 guru strategies we follow, AMZN rates highest using our P/B Growth Investor model based on the published strategy of Partha Mohanram. This growth model looks for low book-to-market stocks that exhi
The last few years have been dynamic for growth stocks. A massive bubble and a rough return to Earth followed the March 2020 COVID-19 crash. Many investors lost faith. But growth stocks demand a prominent place in portfolios for a simple reason. They make shareholders lots of mon
A U.S. retail industry group on Wednesday urged United Parcel Service and the Teamsters union to reach a labor contract deal and avert a strike that could result in billions of dollars of economic losses.
Tech is hot again. After falling in 2022 and taking the rest of the market with it, tech is once again popular with investors. The tech-heavy Nasdaq composite is up 37% so far in 2023, about double the broader S&P 500's gain.
The Motley Fool
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