Wall Street is back on a roller coaster ride as investors try to navigate the path between high inflation and the Fed’s aggressive rate hikes. What we know for sure is that the S&P 500 is down 18% year-to-date and the NASDAQ is down 26%.
However, at least one investment expert is stepping on his soapbox to encourage investors to buy now while prices are low. This is the view of Shark Tank investor Kevin O’Leary. The venture capitalist advocates that investors take advantage of the volatility to start a buying streak.
“If you’re an investor, perhaps the best thing to do here — as you can’t guess the bottom — is to take opportunities like today and buy stocks you think are attractive,” O’Leary noted. .
With this in mind, Wall Street analysts have identified two attractive tickers whose current low stock prices do not reflect their long-term value. The analysts note that each of them will rise on an upward trajectory and see an attractive entry point. Using TipRanks’ database, we found that the analyst consensus rated both Strong Buy as having significant upside potential. Let’s take a closer look at that.
Couchbase, Inc. (BASE)
The first stock stands out in the world of database management. Couchbase manufactures and distributes a suite of open-source database-as-a-service (DBaaS) platforms, providing users with a distributed architecture that enables elastic scaling, workload isolation, and real-time data replication, while avoiding single point security vulnerabilities of failure. The system is built for use on mobile and IoT devices that use intermittent connections, or rely on microservers or consumption-based cloud computing.
That’s all a fancy way of saying that Couchbase’s products — Capella, the Couchbase Server, Couchbase Mobile, and the Autonomous Operator — go where your work is.
Couchbase went to NASDAQ last July and raised $200 million in its IPO. Since then, the shares have fallen by about half, although the company’s sales have steadily increased and net losses have decreased.
In its most recent quarterly report, for the second quarter of fiscal year 2023 — the quarter ended July 31 — Couchbase showed a 34% year-over-year revenue increase, with revenue of $39.8 million. Total revenue included a 32% year-over-year gain in subscription revenue, which was reported at $37.1 million. Annual recurring revenue (ARR), a key measure of future business, reached $145.2 million, a 26% year-over-year gain. The company’s earnings came in at a loss of 19 cents per share in non-GAAP measures. This was a dramatic improvement from the loss of $1.54 per share recorded in the same quarter a year ago.
Five-star analyst Ittai Kidron covers this stock for Oppenheimer, who writes: “Couchbase handily exceeded F2Q expectations and again noted positive demand trends for Capella. It also appears relatively resilient to macro-related demand headwinds given its historic focus on large enterprises. and multi-year deals.While we are vigilant for potential recessionary pressures, we remain optimistic about LT given the strong NoSQL capability and market expansion with DBaaS/Capella.”
Kidron follows up on his comments with an Outperform (ie Buy) rating and a price target of $22, implying a year-on-year gain of ~44%. (To view Kidron’s track record, click here)
Overall, Strong Buy’s consensus rating for this stock is based on 5 recent analyst reviews, including 4 to buy and 1 to hold. The average price target of $22 is practically the same as Kidron’s. (See Couchbase Inventory Forecast at TipRanks)
Helios Technologies (HLIO)
Next up is Helios Technologies, a player in the global industrial technology sector. Helios is a leading supplier of hydraulics and electronics and develops, designs, manufactures and markets a wide range of products and hard-tech solutions. The company’s products include custom electronic control systems, hydraulic cartridge valves and quick release valves, all for a variety of end-use markets. Helios has sales and customers in more than 90 countries around the world.
Helios is working towards a 10-year goal, set in 2015, to reach $1 billion in annual revenue. The company prides itself on being on track to meet that goal ahead of schedule, by 2023. In its last full calendar year, 2021, Helios had more than $869 in net sales; the company posted revenue of $482 million for 1H22 and is on track to beat last year’s total. The most recent quarter, 2Q22, saw revenue of $241.7 million, up 8% year over year. Earnings for 2Q22 came in at $1.18 per diluted share, in non-GAAP measures. This was equal to the first quarter and a 2% year-over-year decline.
That said, Helios has faced headwinds over the past 12 months, including supply disruptions, price/cost pressures and destocking. As a result, the stock has lost 51% since the beginning of the year.
However, 5-star analyst Nathan Jones, of Stifel, remains optimistic about the stock, pointing to several factors that should chart a path forward.
“We continue to see multiple opportunities for Helios in the coming years, within the control of the company: the acquisition made in recent years provides Helios with the opportunity to transform from a holding company to an integrated operating company and to gain capacity, reduce costs. reducing supply chains, shortening supply chains and increasing market penetration worldwide…. Successfully leveraging the companies to simultaneously drive growth above the market while reducing the cost structure,” explains Jones.
Building on this stance, Jones advises HLIO stock to buy and sets a price target of $74. This figure indicates a potential for ~44% profit in the coming year. (To view Jones’ track record, click here)
Overall, all three recent analyst reviews here have been positive, giving Helios’ stock its unanimous Strong Buy consensus rating. HLIO is currently priced at $51.52 and the median price target, $80, implies a 12-month increase of 55%. (See HLIO stock forecast at TipRanks)
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Disclaimer: The opinions expressed in this article are those of the recommended analysts only. The content is for informational purposes only. It is very important to do your own analysis before making any investment.