Bank of America says ‘best-in-class’ stocks are soaring, so buy soon | Wilnesh News
Bank of America analysts say many Buy-rated stocks will outperform heading into the remainder of 2024. CNBC Pro combed through BofA’s research to find stocks the bank considers “best in class.” These companies include Carvana, ESAB, Netflix, Texas Roadhouse and Johnson Controls. According to Bank of America, everything is “on track” for Netflix following its earnings report in October. Analyst Jessica Reif Ehrlich said margins are rising and the company is making the right investments to maintain its long-term streaming leadership. “In addition, NFLX’s existing scale advantages are bearing fruit as healthy revenue growth and cost controls are driving operating leverage, leading to an improved margin outlook to around 27% in 2024,” she said. The bank said that due to future With several quarters of EPS momentum on track to outperform the market, Netflix is poised for further gains. “We believe Netflix remains one of the best positioned companies in the media space and has multiple growth drivers, including accelerated growth in its emerging advertising business, which is expected to double in ’25 and continue to grow in ’26 and ’20. A multi-year growth driver. Shares are up 69% this year. Analyst Sherif El-Sabbahy said the manufacturing technology welding company is too attractive to ignore. Compound growth,” he wrote of the company. El-Sabbahy said Issa is “thriving against a difficult backdrop” as free cash flow continues to expand. In addition, Bank of America said ESAB is well-positioned both domestically and internationally to gain more market share. He added that a strong balance sheet also provides ample room for further growth. Meanwhile, the company’s shares are up 43% this year, and El-Sabbahy still ranks ESAB as his top pick. He calls ESAB “a best-in-class composites manufacturer with short cycle times.” Texas Roadhouse analyst Sara Senatore remained holding on to the Texas-themed restaurant’s stock after it reported earnings at the end of October. “With beef prices continuing to be more favorable than expected, TXRH is well-positioned to maintain restaurant-level margins even if prices decline in (fiscal) 2025,” she wrote. Bank of America said Texas Roadhouse benefited Employee turnover is low, technological innovation and same-store sales continue to improve. In addition, Senatore said that despite the many headwinds faced by the entire industry, traffic growth still shows a “best-in-class” trend and is improving month by month. Bank of America said the company’s shares are up 62% this year and there’s still plenty of room for growth. Senatore continued: “We believe Texas Roadhouse has a lot of room for growth and room to expand its U.S. store count by 70% to approximately 1,000 stores.” Netflix “Season 3: Everything is on track Netflix is a streaming media A global leader in the market, providing best-in-class subscription and advertising video-on-demand services to more than 280 million subscribers in more than 190 countries. …In addition, NFLX’s existing scale advantages are working due to healthy revenue growth and cost control. Driving operating leverage, leading to improved margin outlook to approximately 27% in 2024. ESAB is “a best-in-class compounder with near-cycle upside… The company will continue to compound even against a backdrop of soft manufacturing. … As the manufacturing economy gradually recovers, we expect ESAB to achieve earnings compounding and (free cash flow) further drive multiple growth.” Carvana “The company remains in growth mode, driven by market expansion and existing market penetration. E-commerce delivered best-in-class growth. We believe the company is well positioned for sustained growth at a high level over the long term and see medium-term upside potential given strong inventory levels, resilient consumer demand and (a) North American auto production. Shortage, the term exists. Texas Roadhouse “With beef prices continuing to be more favorable than expected, TXRH is well-positioned to maintain restaurant-level margins even as prices decline in F25. … TXRH (provides) top-notch traffic. Volume trends and revenue growth… …Further operating leverage… We believe Texas Roadhouse has long room for growth, and its number of stores in the United States has room to expand by 70% to approximately 1,000. Johnson Controls’ “first-class data center assets.” And change is coming. … We believe data centers are one of the most profitable industry verticals. … We see JCI’s story as a combination of self-service and structural growth driven by smart building controls, and we think the new CEO is a positive. catalyst.
