Many experts have predicted a recession to be unavoidable this year. Nevertheless, investors can use recency bias to their benefit by avoiding it.
To do so, you should follow the advice of experts and take a look at the five stocks that Stock Target Advisor’s Best Performing Stocks tool has identified as the most rated by analysts this week: T–Mobile (TMUS:NSD), Amazon (AMZN:NSD), PayPal (PYPL:NSD), Alphabet (GOOGL:NSD), and Southwest Airlines (LUV:NYE).
T–Mobile’s (TMUS:NSD) strong performance in 2022 and its outlook for the future have analysts confident in the stock. JPMorgan analyst Philip Cusick noted that customer churn is low and the company has likely experienced solid service revenue growth and better margins in the fourth quarter.
Cusick stands firmly bullish on the stock for the long term, with a price target of $200, and reiterated a Buy rating. Similarly, RBC Capital analyst Kutgun Maral has a Buy rating on the stock and a price target of $166. The average price target among analysts is $182.83, signifying a potential upside of 22.9%.
Looking further out, the average 2023 price target for Amazon (AMZN:NSD) stands at $175, suggesting a further 33.9% jump from its current levels. The average 12–month price target indicates a 57.4% upside potential, while the average 2023 price target suggests a 33.9% upside potential.
Overall, the analyst consensus indicates that Amazon could be a strong long–term bet. While the stock has faced some challenges due to the economic downturn, it is likely to see a recovery in the coming years. Investors should keep an eye on Amazon’s performance in the coming months and years to get a better sense of its long–term potential.
PayPal (PYPL:NSD), the digital payments leader, has seen its competitive risk abate over the past two years, according to a recent analysis from Mizuho analyst Dan Dolev. He observed that PYPL‘s share of outgoing web traffic from U.S. merchants has stabilized.
In response, Truist analyst Andrew Jeffrey upgraded the stock to a Buy from a Hold with a price target of $95, citing expectations that a new CEO will bring a fresh perspective and expand the company‘s total addressable market, potentially boosting terminal revenue and EPS growth.
The average price target for PYPL is $106.96, which implies a 38.9% upside potential from its current price. The stock is rated as a Moderate Buy on Wall Street, with 22 Buys and eight Holds.
Despite the tumultuous year, analysts remain confident in Alphabet’s (GOOGL:NSD) ability to capitalize on long–term digital trends. With the company’s focus on an AI–first strategy and Cloud and Search strength, investors should view the near–term weakness as a buying opportunity.
Analysts remain bullish on Alphabet Inc. (GOOGL), with 32 ratings of the stock a Buy. The average price target of $125.94 implies a potential upside of 43.1% from the current share price. As the internet media and technology giant continues to display strength in Cloud and Search, bolstered by its AI–first strategy, the near–term weakness creates a solid buying opportunity for investors.
Southwest Airlines (LUV:NYE):
The recent flight cancellations were a major shock to Southwest Airlines (LUV:NYE), but its fundamentals remain strong. Moody‘s and CFRA have both expressed confidence that Southwest should be able to manage the resulting credit and customer relations issues. With a Moderate Buy consensus rating and an average price target of $45.82, analysts’ sentiment towards LUV stock is optimistic.
While the uncertainty will remain, these companies have the resilience to remain profitable in the long term. This year could be a difficult one, but T-Mobile, Amazon, Paypal, Alphabet, and Southwest Airlines are well-positioned to weather the storm.