Analysts Are Upgrading These 10 Stocks

In this article, we discuss the 10 stocks that analysts are upgrading. If you want to skip our detailed analysis of these stocks, go directly to Analysts Are Upgrading These 5 Stocks.

The United States (US) economy has recovered from the COVID-19 pandemic faster than expected. According to a data depository maintained by the Department of Commerce, the size of the US economy is now slightly larger than it was before the onset of the coronavirus. This recovery is all the more impressive when viewed in context of the devastation that the virus caused. The US Bureau of Economic Analysis claims that the pandemic recession was the deepest going back over more than seven decades to 1948.

However, this economic downturn was also one of the shortest on record, lasting for just over two months before the markets started bouncing back, according to the National Bureau of Economic Research. Moving forward, several catalysts are likely to spur economic growth. Mark Zandi, the chief economist for financial services company Moody’s Analytics, believes that the US job market will fully recover from the impact of the lockdowns by 2023. Official data indicates that the unemployment rate in the US has plunged from 15% in April 2020 to 5% last month.

Another positive from the pandemic has been the stimulus payments handed by the federal government that have helped keep over 11 million Americans out of poverty, limiting some of the damage from the virus-related recession. The Bureau of Labor Statistics reported earlier this month that job openings in the US stood at close to 11 million in July, a record high over more than two decades and up sharply from 7 million openings in February 2020, just before the virus crisis. All these indicators point to accelerated growth moving forward. 

Some of the stocks that analysts have reiterated their positive outlook on recently as the economic recovery continues to gather steam include NVIDIA Corporation (NASDAQ: NVDA), Facebook, Inc. (NASDAQ: FB), Alphabet Inc. (NASDAQ: GOOG), Apple Inc. (NASDAQ: AAPL), and Advanced Micro Devices, Inc. (NASDAQ: AMD), among others discussed in detail below. NVIDIA Corporation and Advanced Micro Devices have benefited from a semiconductor shortage that has pushed prices sky high.

Facebook, Alphabet, and Apple have continued on a growth trajectory accelerated by the pandemic because of the rush towards digital. The S&P 500 has nearly doubled from a March 2020 low and presently stands at a record high. However, investors should be wary of the spread of the Delta variant of the virus, increased skepticism towards vaccinations in some parts of the world, and the possibility of intermittent lockdowns, all factors that are likely to affect the recovery momentum. 

Photo by Tech Daily on Unsplash

 

Our Methodology

With this context in mind, here is our list of the 10 stocks that analysts are upgrading. All the firms listed below have had their ratings upgraded by an investment advisory on September 17 or September 16.

The hedge sentiment around each stock was gauged using the data of 873 hedge funds tracked by Insider Monkey. The list is ranked according to the number of hedge funds having stakes in each firm.

Why pay attention to hedge fund holdings? Insider Monkey’s research was able to identify in advance a select group of hedge fund holdings that outperformed the S&P 500 ETFs by wide margins Between March 2017 and July 2021 our monthly newsletter’s stock picks returned 186.1%, vs. 100.1% for the SPY. Our stock picks outperformed the market by more than 86 percentage points (see the details here). That’s why we believe hedge fund sentiment is an extremely useful indicator that investors should pay attention to. You can subscribe to our free newsletter on our homepage to receive our stories in your inbox.

Analysts Are Upgrading These Stocks

10. Eni S.p.A. (NYSE:E)

Number of Hedge Fund Holders: 3  

Eni S.p.A. (NYSE:E) is placed tenth on our list of 10 stocks that analysts are upgrading. The company explores, develops, and produces crude oil and natural gas. It is headquartered in the city of Rome in Italy. 

On September 17, investment advisory JPMorgan upgraded Eni S.p.A. (NYSE:E) stock to Overweight from Underweight with a price target of EUR15, noting that European oil stocks offered outsized exposure to stronger commodity prices. 

At the end of the second quarter of 2021, 3 hedge funds in the database of Insider Monkey held stakes worth $69 million in Eni S.p.A. (NYSE:E), down from 4 in the previous quarter worth $74 million.

Just like NVIDIA Corporation (NASDAQ: NVDA), Facebook, Inc. (NASDAQ: FB), Alphabet Inc. (NASDAQ: GOOG), Apple Inc. (NASDAQ: AAPL), and Advanced Micro Devices, Inc. (NASDAQ: AMD), Eni S.p.A. (NYSE:E) is one of the stocks that analysts are bullish on heading into the third quarter.

9. InterContinental Hotels Group PLC (NYSE:IHG)

Number of Hedge Fund Holders: 6 

InterContinental Hotels Group PLC (NYSE:IHG) is ranked ninth on our list of 10 stocks that analysts are upgrading. The firm owns, manages, and leases hotels across the world. It is headquartered in the United Kingdom. 

On September 17, investment advisory Berenberg upgraded InterContinental Hotels Group PLC (NYSE:IHG) stock to Buy from Hold and hiked the price target to GBP5,400 from GBP4,500, underlining that the firm was well-positioned to beat consensus estimations in 2021.

At the end of the second quarter of 2021, 6 hedge funds in the database of Insider Monkey held stakes worth $10 million in InterContinental Hotels Group PLC (NYSE:IHG), down from 8 in the preceding quarter worth $19 million. 

In its Q4 2020 investor letter, Fundsmith LLP, an asset management firm, highlighted a few stocks and InterContinental Hotels Group PLC (NYSE:IHG) was one of them. Here is what the fund said:

“We hardly need to discuss the reasons for the poor performance of InterContinental Hotels. Airline and travel reservations and hotel management have not been happy places to be in the past year, although it is worth noting nowhere near as bad as investing in actual airlines or hotels. InterContinental’s share price fall of -9.9% compares with a drop of -35.1% for the Dow Jones US Hotel and Lodging REIT Index. This illustrates the virtues of InterContinental’s business model in contrast to the industry it serve.

However, whilst they face a difficult situation, we are pleased that management has spent its time and effort managing liquidity and costs in an effort to ensure that they survive these events rather than pointlessly speculating about the likely timescale and course of recovery. We believe that they should not only survive but also strengthen their competitive position.”

8. Accolade, Inc. (NASDAQ:ACCD)

Number of Hedge Fund Holders: 24 

Accolade, Inc. (NASDAQ:ACCD) is a Pennsylvania-based company that markets technology solutions to help people navigate the healthcare industry in the United States. It is placed eighth on our list of 10 stocks that analysts are upgrading.

On September 17, investment advisory Baird upgraded Accolade, Inc. (NASDAQ:ACCD) stock to Outperform from Neutral but lowered the price target to $54 from $58, highlighting that the shares of the firm were trading at a discount to peers. 

At the end of the second quarter of 2021, 24 hedge funds in the database of Insider Monkey held stakes worth $594 million in Accolade, Inc. (NASDAQ:ACCD), up from 19 the preceding quarter worth $471 million. 

In addition to NVIDIA Corporation (NASDAQ: NVDA), Facebook, Inc. (NASDAQ: FB), Alphabet Inc. (NASDAQ: GOOG), Apple Inc. (NASDAQ: AAPL), and Advanced Micro Devices, Inc. (NASDAQ: AMD), Accolade, Inc. (NASDAQ:ACCD) is one of the stocks that has received positive coverage from stock analysts recently.

7. Mister Car Wash, Inc. (NYSE:MCW)

Number of Hedge Fund Holders: 31   

Mister Car Wash, Inc. (NYSE:MCW) is an Arizona-based company that provides car wash services. It is ranked seventh on our list of 10 stocks that analysts are upgrading.

On September 17, investment advisory Bank of America upgraded Mister Car Wash, Inc. (NYSE:MCW) stock to Buy from Neutral with a price target of $23, backing growth based on recovery in miles driven, protection against online disruptors, and industry consolidation.

Out of the hedge funds being tracked by Insider Monkey, California-based investment firm Leonard Green & Partners is a leading shareholder in Mister Car Wash, Inc. (NYSE:MCW) with 229 million shares worth more than $4.9 billion. 

6. DTE Energy Company (NYSE:DTE)

Number of Hedge Fund Holders: 32   

DTE Energy Company (NYSE:DTE) is placed sixth on our list of 10 stocks that analysts are upgrading. The firm engages in utility operations and operates from Michigan. 

On September 17, investment advisory Evercore upgraded DTE Energy Company (NYSE:DTE) stock to Outperform from In Line and hiked the price target to $127 from $119, noting that earnings growth and regulatory jurisdiction had positioned the stock for an expanded multiple.

At the end of the second quarter of 2021, 32 hedge funds in the database of Insider Monkey held stakes worth $469 million in DTE Energy Company (NYSE:DTE), up from 26 in the preceding quarter worth $205 million. 

NVIDIA Corporation (NASDAQ: NVDA), Facebook, Inc. (NASDAQ: FB), Alphabet Inc. (NASDAQ: GOOG), Apple Inc. (NASDAQ: AAPL), and Advanced Micro Devices, Inc. (NASDAQ: AMD) are some of the stocks with growth potential in the coming months, alongside DTE Energy Company (NYSE:DTE). 

 

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Disclosure. None. Analysts Are Upgrading These 10 Stocks is originally published on Insider Monkey.