6 Top Contrarian Calls With Markets at Record Highs

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Illumina

This is a life sciences play that may look better than other biotechs for more risk-averse investors. Illumina Inc. (NASDAQ: ILMN) provides sequencing and array-based solutions for genetic analysis. Its sequencing by synthesis technology provides researchers with various applications and the ability to sequence mammalian genomes. It also offers arrays for a range of DNA and RNA analysis applications, including single nucleotide polymorphism genotyping, copy number variations analysis, gene expression analysis and methylation analysis, as well as allowing for the detection of known genetic markers on a single array.

The company also provides various library preparation and sequencing kits to simplify workflows and accelerate analysis, as well as genome sequencing, genotyping and non-invasive prenatal testing services. It serves genomic research centers, academic institutions, government laboratories and hospitals, as well as pharmaceutical, biotechnology, agrigenomics, commercial molecular diagnostic laboratories and consumer genomics companies.

The consensus price target surprisingly is $186.21, while shares closed Thursday at $211.04.

Technology

Cisco

This top mega-cap technology stock pick on Wall Street makes good sense for investors seeking tech exposure. Cisco Systems Inc. (NASDAQ: CSCO) designs, manufactures and sells internet protocol (IP) based networking products and services related to the communications and information technology industry worldwide.

It provides switching products, including fixed-configuration and modular switches, and storage products that provide connectivity to end users, workstations, IP phones, wireless access points and servers, as well as next-generation network routing products that interconnect public and private wireline and mobile networks for mobile, data, voice and video applications.

Wall Street likes the company’s stellar balance sheet, and the ability for the company’s gross margins to move close to the 65% range on a consistent basis as it moves away from the legacy products sold for switching and routing. Cisco is another company that could benefit from the tax on overseas money being lowered as it has a whopping $70 billion in cash, 90% of which is overseas.

While Cisco reported fiscal fourth-quarter results that beat or matched most estimates, revenue was down year over year for the seventh consecutive quarter. Despite the decline, Cisco has beaten earnings and sales estimates for every quarter since CEO Chuck Robbins took over from John Chambers two years ago, and most think he has the tech giant headed in the right direction.

Shareholders receive a 3.6% dividend. The consensus target price is $35.73. Shares closed Thursday at $32.19.

Qorvo

This company was formed after the merger of RF Micro Devices and Triquint Semiconductor. Qorvo Inc. (NASDAQ: QRVO) is a leading provider of core technologies and radio frequency (RF) solutions for mobile, infrastructure and aerospace/defense applications. Qorvo has more than 7,000 global employees dedicated to delivering solutions for everything that connects the world.

The company has among the industry’s broadest portfolio of products and core technologies. Some analysts are convinced that the higher RF content in new smartphones should offset quarterly unit volatility. They also think strategic mergers and acquisitions could help diversify the company away from mobile dependence and add longer life business cycle products.

The consensus is price target for the stock is $76.04. Shares closed Thursday at $73.48.

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Six contrarian picks in sectors that are acting very good and should continue to do so the balance of this year and into 2018. It never hurts to add stocks that are out of favor when the market is very expensive.