Wells Fargo’s September top picks include the tech giant and pharma giant | Wilnesh News
Wells Fargo highlights a series of stocks poised to gain significantly in September. CNBC Pro compiled the firm’s research on Overweight-rated stocks that analysts believe have more room to rise. These include Uber Technologies, Microsoft, Burlington Stores, DR Horton and Eli Lilly. “Momentum is building,” Burlington Stores analyst Ike Boruchow said of the discount apparel retailer. The company said Burlington’s recent quarterly report was so strong that it called the results a “thesis affirmative.” Burlington reported second-quarter revenue and net income, as well as solid guidance for the third quarter. “BURL did deliver strong second-quarter earnings growth/growth on high expectations, with accelerating results and impressive margin flow,” Boruchow said. The analyst said management was operating in an uncertain macro environment Still, he’s impressed by Xia’s ability to attract all types of consumers. Burlington’s shares will rise 33% by 2024, but the price remains “attractive,” Boruchow said. “BURL remains our top pick with a $325 price target,” the analyst said, indicating room for 25% upside from Friday’s closing price. Wells Fargo analyst Sam Reid said the homebuilder’s shares will rise 22% by 2024, but its appeal remains hard to ignore. The analyst said Dr. Horton is one of the company’s top picks, especially if the Fed starts cutting interest rates. “DHI’s risk-reward profile is optimally adjusted at lower rates, but lower ASPs (average selling prices) provide protection against rising inventory,” Reed said. The firm also raised its price target to $220 per share from $210. dollar, adding “we believe a re-rating may be underway.” This represents an increase of 18% from Friday’s closing price. Reed said the homebuilder has a number of levers at its disposal, even in a challenging macro environment. “DHI (Overweight) is our primary entry-level pick in the residential construction space,” the analyst said. Analyst Michael Thelin said the tech giant is in an “early lead” in artificial intelligence. Wells Fargo added the stock to its signature picks list earlier this week, citing the “re-acceleration of cloud computing.” Turrin wrote: “Newly disclosed information shows that Azure’s year-on-year cc (calculated at constant exchange rates) increased by 35% in June 2024, far ahead of peers AWS and GCP (Google Cloud Platform).” He also said that in addition to Beyond the revenue-sharing potential in search, Microsoft has several other levers it can leverage, including its booming cybersecurity business. The company’s shares are set to rise 33% by 2024, but Turrin urged clients to buy and said the valuation was fair. He added: “Microsoft is a leader and share grower in cloud infrastructure and we believe will benefit from the formation of important artificial intelligence product cycles.” Eli Lilly and Company “We are refreshing our large-cap rankings to take into account Some recent rating changes and news flow. …We continue to believe Eli Lilly has the potential to deliver an upside surprise as supply improves and OUS (ex-U.S.) grows. “With high expectations, Burlington Stores. Strong Q2 results indeed – results are accelerating, profit flow is impressive, momentum is building, strategy is delivering results, and EPS capabilities are compelling. BURL remains our top pick at $325 PT. …another paper that definitely prints. Dr. Horton “DHI’s risk reward adjusts best at lower rates, but lower ASPs provide protection against rising inventories. … We will PT+$10 raised to $220, which implies a P/E ratio of 13x and TBV of 2.5x, a nod that we believe a re-rating may be in the works… DHI (Overweight) is our primary entry in the residential construction sector level choice, with a production-oriented construction approach. ” Uber Technologies “Uber remains the top choice for 2H. See YE24 largely addresses bear case scenario for slowdowns and AV (autonomous vehicle) endpoint risks. …Our 2024 Annual EBITDA estimates are above Wall Street, driven by a favorable combination of continued international liquidity competition, rationality and a favorable appetite for liquidity. We believe the stock is likely to perform even better as our forecasts for the next 18 months are aligned. .Microsoft “is ready for a reacceleration in the cloud. …MSFT is a leader and share grower in cloud infrastructure and we believe will benefit from the formation of a significant AI product cycle. …MSFT is a leader in cloud infrastructure” One of the few key players with an early lead in genAI… New disclosures show Azure grew 35% year over year in June 2024, well ahead of peers AWS (+19%) and GCP.
