With traditional Dow Jones Industrial Average and S&P stocks, analysts are currently assigning targets with 8% to 15% upside. Any rational investor understands that there is a much larger risk when an analyst calls for more than 100% upside.
While some of the price targets discussed here call for a stock to double, or even to rise exponentially, it is important to understand that not every analyst call comes true. Sometimes their assumptions get changed by outside events, and in some cases analysts just get their whole view wrong and the great upside turns into serious pain.
24/7 Wall St. reviews dozens of analyst research reports each day of the week. This ends up being hundreds of analyst calls over the course of each month. Here we’ve taken a look at some the best analyst upgrades that happened over the course of June. Some of these stocks are expected to double — or even rise much more.
Nutanix Inc. (NASDAQ: NTNX) recently announced a new partnership with Alphabet Inc.’s (NASDAQ: GOOGL) Google. Nutanix ultimately formed this partnership to allow customers to move application workloads easily between on-premise data centers running on Nutanix gear and Google’s public cloud. As a result, Credit Suisse reiterated an Outperform rating with a $38 price target, versus an $18.64 price (implying upside of 104%) on June 28.
The brokerage firm believes this partnership is an endorsement of Nutanix’s road map. Over time, the firm believes this will allow it to tap into the $32 billion total addressable market at a faster pace by leveraging the hybrid cloud structure. Additionally, this move confirms Credit Suisse’s view on the company’s growth potential and its above-consensus estimates could prove conservative. Credit Suisse assumes revenues of $762 million (+71%) and $1.2 billion (+52%) in fiscal 2017 and fiscal 2018, respectively.
Shares of Nutanix were last seen at $20.15, with a consensus analyst price target of $27.76 and a 52-week trading range of $14.38 to $46.78.
Alphabet shares closed out the week at $929.68. The stock has a 52-week range of $699.00 to $1,008.61 and a consensus price target of $1,061.17.
Oracle Corp. (NYSE: ORCL) shares hit a new all-time high after the company reported its most recent quarterly results. Most analysts chased the stock after reading the report, but one analyst call stood out from the rest. Merrill Lynch was the biggest bull for Oracle and actually raised its price objective to the highest on the street. The brokerage firm reiterated its Buy rating but raised its price target to $62 from $54 on June 22. This compares with the previous closing price of $46.33, implying an upside of 34%.
Although this call might seem small compared to the other featured here, it may be the most valuable considering the market cap. Merrill Lynch basically believes that the license decline of 10% to 15% in the past several quarters is a self-induced near-term phenomenon in light of the cloud transition, which is inflecting higher year over year for the first time in two years. The firm thinks the risk is to the upside if the company can deliver on lowered earnings expectations in the future.
Shares of Oracle were most recently trading at $50.14. The consensus price target is $54.71 and a 52-week range of $37.62 to $51.85.
Aqua Metals Inc. (NASDAQ: AQMS) was started as Buy and assigned a $25 price target at Rodman & Renshaw on June 22. This might feel controversial, and not just because of the 100% implied upside. The stock was up at $16 as recently as May but has traded most recently around $12. While this is a call to double, Aqua Metals is volatile and has a 52-week trading range of $8.13 to $22.75. Shares were last seen at $12.55, with a consensus price target of $26.25.