U.S. stock index futures edged higher on Wednesday, with those of the Nasdaq rising the most on gains in Tesla shares, while investors treaded cautiously ahead of comments from Federal Reserve Chair Jerome Powell later in day.
There's no such thing as a perfect investment. Buying a stock always involves a trade-off between risk and reward, but also the certainty that at least a few things won't go according to plan. Companies are forever reacting to changing consumer preferences, new competitive threat
Investors are eager to move on from 2022, which has been a challenging year. Stocks of all shapes and sizes have been beaten down, and while tech stocks have faced the brunt of it, few were immune to price declines this year. Even stalwarts like Target and Microsoft have declined
Salesforce (NYSE: CRM) is scheduled to report its fiscal Q3 2023 results on Wednesday, November 30. We expect Salesforce to edge past the consensus estimates of revenues and earnings. The company surpassed the street expectations in the last quarter, with total revenues of
Wall Street's main indexes fell on Tuesday as growth stocks extended declines, overshadowing a rise in energy shares after oil prices pared back gains on OPEC+ output concerns.
Wall Street's main indexes were little changed on Tuesday as growth stocks extended losses, while a rise in energy shares on the back of higher oil prices helped stave off declines.
Of the 3 major indexes, the Dow Jones has suffered the least in 2022’s bear, showing year-to-date losses of 7% against the S&P 500’s 17% drop and the NASDAQ’s far more extreme 29% decline.
Jim Cramer, the well-known host of CNBC’s ‘Mad Money’ program, believes that a big part of the blue-chip index’s better display is down to it being crammed with more established old school names, and ones that are profitable, compared to the S&P’s more mixed affair and the tech-heavy NASDAQ, which is home to more growth-oriented, unprofitable companies.
But if you think 2023 will usher in a changing of the guard, Cramer believes otherwise. “As we head into the end of the year, Wall Street tends to crowd into the biggest winners, which is why I expect the Dow to keep outperforming the Nasdaq and the S&P, at least until January, possibly even a lot longer," Cramer said.
With this in mind, we used the
TipRanks database to find three Dow stocks that could well-benefit from ongoing DOW dominance. More importantly, all three have garnered substantial support from Wall Street with a “Strong Buy” analyst consensus. Let’s see what the analysts like about them.
Microsoft Corporation
(
MSFT
)
Hardly any companies come bigger than Microsoft, the first Dow stock we’ll look at. It is the second biggest company in the world by market cap, the tech giant being a home and office computing pioneer, having built its empire on the ubiquitous MS Windows operating system and its business apps suite for PCs, MS Office.
But the company has branched out from there and now encompasses everything from cloud computing (Azure) to gaming (Xbox) and along the way there have been some huge acquisitions that have widened its remit, the biggest of which have been gaming giant Activision Blizzard ($69 billion - expected to close next year), networking site Linkedin ($26 billion), and cloud and AI software company Nuance ($19.7 billion), with plenty of others trailing behind.
The tough economic backdrop has weighed on all and sundry this year, but despite the ongoing headwinds, Microsoft still managed to deliver a positive set of financial metrics in its latest quarterly report – for the first quarter of fiscal 2023 (September quarter). Revenue climbed by 10.6% year-over-year to $50.1 billion while the company delivered EPS of $2.35, marking a modest y/y increase of 3.5%. Both results bettered Street expectations.
However, the company warned of trouble ahead due to the precarious state of the global economy. For the December quarter, Microsoft guided for revenue between $52.4 billion and $53.4 billion, some distance below the Street’s expectation of $56.1 billion.
Investors might have shown their disappointment and the shares might be down by 27% year-to-date, but Argus analyst
Joseph Bonner sees plenty of reasons to keep on backing a company he believes “may just hold the premiere position in business technology.”
“Although obviously not immune from macroeconomic factors, Microsoft has about as diversified and strong a set of assets as any company in the Technology industry -- and may even be looked at as a haven by investors looking for a flight to quality in uncertain times and market conditions,” Bonner explained. “The company is one of a few with a complete and integrated product set aimed at enterprise efficiency, cloud transformation, collaboration, and business intelligence. It also has a large and loyal customer base, a large cash cushion, and a rock-solid balance sheet.”
Accordingly, Bonner rates MSFT shares a Buy, while his $371 price target implies ~53% upside potential from current levels. (To watch Bonner’s track record,
click here
)
Overall, there’s no doubts on Wall Street that the bulls are running with MSFT; the stock’s 29 recent analyst reviews break down 26 to 3 in favor of Buys over Holds for a Strong Buy consensus rating. The shares are priced at $242.02 and have an average target of $295.38, which indicates room for ~22% growth in the year ahead. (
See MSFT stock forecast on TipRanks)
The Walt Disney Company (
DIS
)
Does Walt Disney really need an introduction? The entertainment behemoth’s reputation precedes it, and the company is not known as the Content King for nothing. Disney’s offerings span everything from its world-famous theme parks to its film studio division Walt Disney Studios (which counts amongst its roster the Walt Disney Animation Studios, Marvel Studios, Lucasfilm, Pixar and Searchlight Pictures), cable television networks including the Disney Channel, ESPN, and National Geographic, and the Disney+ streaming service.
Despite all the above, Disney has been going through some tough times. The company took a big hit during the pandemic, what with shuttered theme parks, closed movie theaters, and halts to live action productions. And recently, the global economic woes have made their presence felt. In fact, the troubles have been so acute, they have ushered in the recent and unexpected return of former CEO Bob Iger, called upon to turn Disney’s fortunes around.
Iger took hold of the reins following a woeful fiscal fourth quarter report (October quarter). While revenue increased by 8.7% year-over-year to $20.15 billion, that figure fell short of Street expectations by $1.29 billion. Likewise on the bottom-line, the company delivered adj. EPS of $0.30, some distance below the $0.56 anticipated by the analysts.
On a bright note, the company did add 12.1 million Disney+ subscribers, way above the 9.3 million additions anticipated on Wall Street. Disney+ is part of the company’s DTC (direct to consumer) business, a segment which Tigress Financial analyst
Ivan Feinseth believes can propel the company forward.
“DTC remains a key growth opportunity, with DIS’s DTC services adding nearly 57 million subscriptions this year for a total of over 235 million,” the 5-star analyst said. “Content is King, and DIS is the King of Content, which continues to drive its flywheel of growth. DIS’s strong brand equity, innovative entertainment development capabilities, and ongoing investments in new digital media development initiatives will drive greater Return on Capital, increasing Economic Profit, and long-term gains in shareholder value creation.”
To this end, Feinseth rates DIS a Buy while his Street-high $177 price target suggests the shares will climb 85% higher over the one-year timeframe. (To watch Feinseth’s track record,
click here
)
Most analysts agree with Feinseth’s thesis; the stock claims a Strong Buy consensus rating, based on 17 Buys vs. 3 Holds. The average target stands at $122.25, making room for 12-month growth of ~28%. (
See Disney stock forecast on TipRanks)
Visa Inc. (
V
)
The last Dow stock we’ll look at is a giant of a different kind. Visa is a global payments leader and amongst the world's most valuable companies. Instead of issuing cards, extending credit, or establishing rates and fees for consumers, what Visa actually does is give financial institutions access to payment products bearing the Visa brand, which they can use to offer credit, debit, prepaid, and cash access services to their clients. Its network enables digital payments in more than 200 countries and territories and has facilitated 255.4 billion transactions with a total volume of $14 trillion in the 12 months leading up to June 2022.
While Visa volumes and revenues went through a lull during the pandemic, they have been rising steadily since, as was the case again in the recently reported fiscal fourth quarter statement (September quarter). Revenue came in at $7.8 billion, amounting to a 19% increase on the same period last year, while beating the Street’s forecast by $250 million. Likewise, adj. EPS of $1.93 trumped the $1.86 anticipated by the analysts. At the same time, the board raised Visa's quarterly cash dividend by 20% to $0.45 a share and gave the go ahead for a new $12.0 billion share repurchase program.
That is the sort of performance and activities which have shielded the stock from much of 2022’s carnage (the shares are down by only 2.5% in 2022).
Assessing Visa’s prospects, Morgan Stanley’s
James Faucette believes that even in the event of a recession, the company should be “well protected.”
Explaining his bullish stance, Faucette writes: “V is one of our preferred stocks, as it is a key beneficiary of resilient global consumer spend growth, the ongoing shift from cash to electronic payments, and broadening merchant acceptance… We see upside opportunity from faster-than expected recovery of travel and the sustained strength of cross-border ecommerce. Continued investment in longer term initiatives (faster payments, P2P, B2B) and partnerships continue to increase its TAM and offer an opportunity for compounding double digit earnings growth for the foreseeable future.”
It's no wonder, then, that the 5-star analyst rates V shares an Overweight (i.e., Buy) while his $284 price target could deliver returns of 34% over the course of the next year. (To watch Faucette’s track record,
click here
)
That bullish sentiment is mirrored by the rest of the Street’s take; while one analyst remains on the sidelines, all 17 other recent analyst reviews are positive, providing the stock with a Strong Buy consensus rating. The forecast calls for 12-month gains of ~17%, considering the average target stands at $246.33. (
See Visa stock forecast on TipRanks)
To find good ideas for stocks trading at attractive valuations, visit TipRanks’
Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.
Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
Microsoft (NASDAQ: MSFT) is one of the most valuable companies in the world. Despite the high market cap, Microsoft could be an excellent stock to buy for long-term investors.
Many investors will be happy to see 2022 end. It's been a year of decline in the stock market as many industries have suffered from lower consumer spending wth inflation rising in equal measure.
Launched on 12/01/2016, the iShares ESG Aware MSCI USA ETF (ESGU) is a smart beta exchange traded fund offering broad exposure to the Style Box - All Cap Growth category of the market.
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Compared to 25 years ago, the investing landscape has changed drastically. Thanks to the internet, everyday investors have the ability to look up income statements, company press releases, investor presentations, and Securities and Exchange Commission filings at the click of a bu
Social media site Twitter is popular, but not everyone's a fan. Ever since Elon Musk took ownership of Twitter, some users have been anxious about sweeping changes at the platform and within the company that may happen. Musk is a controversial individual, and his unapologetic planned workforce reductions at Twitter could raise questions among investors. Among those questions is, what will a significantly smaller Twitter look like, and will its user stay on the platform through the transition?
If you don't believe in Twitter due to the potential chaos ahead, there are alternatives. Here are
three social media platforms, META, MSFT, and DWAC, that are investable right now and could thrive even if Twitter flounders.
Meta Platforms (
NASDAQ: META)
Meta Platforms is a social media and metaverse platform that owns Facebook and Instagram. Like Twitter, Meta is undergoing workforce reductions and has a somewhat controversial leader.
However, CEO
Mark Zuckerberg has a vision that Musk doesn't seem to have. Specifically, Zuckerberg is transitioning Meta Platforms into a metaverse-focused company, so it's not entirely dependent on Facebook and Instagram's revenue.
That said, it's encouraging to know that Meta still has Facebook, which is popular among older social media users, as well as Instagram, which appeals strongly to the Millennial and Zoomer age demographics.
Frankly, these two platforms aren't associated with the Musk-Twitter controversy now, and that's good news for investors seeking stability. Plus, you'll get great value with META stock, as the company has a trailing 12-month
P/E ratio of just 10.6x, suggesting a bargain that's hard to resist.
What is the Price Target for META Stock?
META has a Moderate Buy consensus rating based on 26 Buys, nine Holds, and three Sell ratings assigned in the past three months. The average Meta Platforms stock price target of $147.24 implies 35.4% upside potential.
Microsoft (
NASDAQ: MSFT)
Microsoft is a well-known software and cloud computing company that also happens to own the social media site LinkedIn. Unlike Twitter, Microsoft has little to no controversy associated with the company.
There's much more to Microsoft than LinkedIn, so you'll want to research the company thoroughly before buying MSFT stock. Still, a stake in LinkedIn could prove to be profitable as this social media site is quite popular among professionals in various industries.
Believe it or not, LinkedIn had 875 million global users as of October 2022. Moreover, LinkedIn users tend to be loyal to the platform, so there's no reason to expect userbase attrition in 2023 and 2024.
MSFT stock slid throughout the year, but it may be poised for a swift comeback. Indeed, LinkedIn could help Microsoft and its shareholders thrive with steady multi-year growth.
What is the Price Target for MSFT Stock?
MSFT has a Strong Buy consensus rating based on 25 Buys and three Hold ratings assigned in the past three months. The average Microsoft stock price target of $292.58 implies 21% upside potential.
Digital World Acquisition (
NASDAQ: DWAC)
Digital World Acquisition is a blank-check company, also known as a special purpose acquisition company or SPAC. It plans to merge with Trump Media & Technology Group (TMTG), which is run by former U.S. President Donald Trump. TMTG operates a social media app called Truth Social.
A bit of positive news just happened with Digital World Acquisition, as the shareholders voted to give the company until September 2023 to finalize its merger plans with TMTG. Bear in mind that this merger needs to happen in order for TMTG to be directly tradable without Digital World Acquisition.
TMTG stands to gain $1.3 billion in cash if and when the merger is finalized. These funds could conceivably be spent on expanding Truth Social and attracting well-known content creators. Furthermore, Truth Social could get a boost of popularity as Trump recently announced his intent to run for president in 2024.
If you're anticipating a "red wave" of conservative sentiment in the world of politics, Truth Social could become very popular in the coming years. If that happens - and if the Digital World Acquisition-Truth Social merger finally takes place - DWAC stock should have lots of room to run.
Regarding analyst price targets, however, DWAC currently doesn't have one.
Conclusion: META, MSFT, and DWAC Look Interesting
Twitter and Musk may prove to be unpredictable in 2023. However, there are other social media platforms to consider buying now. Consider META, MSFT, and DWAC shares - one, two, or all three if you'd like - as the social media revolution can move forward with or without Twitter.
Disclosure
The NASDAQ 100 After Hours Indicator is down -4.86 to 11,582.89. The total After hours volume is currently 137,061,190 shares traded.The following are the most active stocks for the after hours session: Southwestern Energy Company (SWN) is -0.0001 at $6.84, with 6,525,621 shares
U.S. stocks ended sharply lower on Monday after protests in major Chinese cities against strict COVID-19 policies sparked concerns about economic growth, while Apple Inc slid on worries about a hit to iPhone production.
U.S. stocks ended sharply lower on Monday after protests in major Chinese cities against strict COVID-19 policies sparked concerns about economic growth, while Apple Inc slid on worries about a hit to iPhone production.
Wall Street stocks tumbled on Monday as protests in major Chinese cities against strict COVID-19 policies sparked concerns about economic growth, while Apple Inc slid on worries about a hit to iPhone production.
What happened
Shares of video games maker Activision Blizzard (NASDAQ: ATVI) fell more than 4% on Friday in response to news that the Federal Trade Commission (FTC) may be preparing to file suit to block Activision's acquisition by Microsoft (NASDAQ: MSFT) in the next few weeks.
Wall Street's main indexes fell on Monday as protests in major Chinese cities against strict COVID-19 policies sparked concerns over economic growth and dragged commodity-linked shares lower, while Apple slid on worries about a hit to iPhone production.