Top Stocks Liked by Wall Street Analysts

Amazon

E-commerce and cloud computing giant Amazon (AMZN) is this week’s first pick. Earlier this month, the company trounced analysts’ second-quarter earnings estimates and returned to double-digit revenue growth.

DBS analyst Sachin Mittal noted that after seven quarters of losses due to macro headwinds, the company’s retail segment generated operating profit in the second quarter. The analyst expects the retail segment to be a key driver of AMZN’s share price appreciation from this year onwards.

Mittal increased his price target for AMZN to $175 from $150 and reaffirmed a buy rating on the stock, citing the company’s leadership position in e-commerce and dominant position in the cloud through AWS.

The analyst is also optimistic about the robust growth opportunity for Amazon’s online advertising business. “More advertisers are turning to AMZN’s retail media network to deceive Apple’s privacy changes and get closer to shoppers,” Mittal said.

AppLovin

Mobile app technology platform AppLovin (APP) recently impressed Wall Street by surpassing second-quarter earnings estimates. The company also issued better-than-anticipated revenue guidance for the third quarter.

Following the Q2 print, Goldman Sachs analyst Eric Sheridan increased his price target for AppLovin to $50 from $25 and reiterated a buy rating. The analyst noted that the evolution of the company’s software platform drove revenue and margin upside in the second quarter, in the wake of improving industry trends.

Sheridan holds the 188th position among more than 8,500 analysts on TipRanks. His ratings have been profitable 61% of the time, with each rating delivering an average return of 13.3%.

Datadog

Another Goldman Sachs analyst on this week’s list is Kash Rangan, who remains bullish on Datadog (DDOG) even after the cloud-based IT monitoring and security platform spooked investors with its lackluster revenue outlook for the third quarter. The company also trimmed its full-year revenue guidance.

Rangan noted that the slowdown in spending by Datadog’s larger customers and the pace of net new enterprise additions disappointed investors. Nevertheless, the analyst is encouraged by the solid second-quarter bookings, with remaining performance obligations (RPO) increasing 42% year-over-year compared to the 33% growth seen in the first quarter.

Rangan reiterated a buy rating on DDOG stock with a price target of $114, saying that his long-term thesis remains intact. He highlighted solid product stickiness, growing platform penetration, and product innovation as reasons for his optimism.

Royal Caribbean

We now move to cruise operator Royal Caribbean (RCL), which recently raised its full-year outlook and reported blockbuster second-quarter earnings. The company is enjoying strong business due to pent-up travel demand.

This week, Tigress Financial analyst Ivan Feinseth reiterated a buy rating on RCL and raised his price target to $139 from $102, citing stellar demand for cruise vacations, the company’s industry-leading position, and its solid value proposition.

The analyst thinks that the company is well-positioned to gain from the reprioritization of consumer spending toward travel and experiences following the pandemic. Feinseth expects RCL’s “Perfect Day at CocoCay” private island resort to be a key growth driver and industry differentiator, which could fuel significant incremental revenue growth and yields.

Netflix

We end this week’s list with streaming giant Netflix (NFLX), which reported upbeat second-quarter earnings but fell short of analysts’ revenue expectations.

JPMorgan analyst Doug Anmuth reiterated a buy rating on the stock with a price target of $505. He pointed out certain areas that investors are concerned about, including paid sharing monetization and how and when it will boost average revenue per membership.

Anmuth expects paid sharing monetization to be highly accretive to revenue over time. Additionally, he expects advertising to be a bigger and more reliable revenue stream than paid sharing for Netflix in the future.

Disclaimer: The information provided here is for informational purposes only. It should not be considered legal or financial advice.