The markets may still be nervous, and there could be another leg down, but one area that is showing strong growth and demand is telecom services. In a new research note, Cowen’s highly regarded analyst Colby Synesael and his team make some changes to the top three high conviction stocks to buy.

With demand for storage, streaming, latency, bandwidth and more skyrocketing, the top companies in the sector continue to shine. Cowen’s top three stocks to buy remain solid additions to an aggressive growth portfolio, and all are rated Outperform.

Level 3 Communications

This company remains in the number one position of the top three high conviction picks. Level 3 Communications Inc. (NASDAQ: LVLT) provides local, national and global communications services to enterprise, government and carrier customers. Level 3’s comprehensive portfolio of secure, managed solutions includes fiber and infrastructure solutions, IP-based voice and data communications, wide-area Ethernet services, video and content distribution, and data center and cloud-based solutions. Level 3 serves customers in more than 500 markets in over 60 countries over a global services platform anchored by owned fiber networks on three continents and connected by extensive undersea facilities.

While the company reported second-quarter numbers that were disappointing, the Cowen team feels that growth should start to accelerate in the third quarter, and even more so in the fourth quarter. They reset numbers in line with management guidance but continue to believe that the current entry point for the stock is very compelling, and the long-term thesis for the company remains unchanged.

The Cowen price target for the stock is $62, and the Thomson/First Call consensus price target is at $60.36. Shares closed Wednesday at $45.44.

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