From time to time, the stock market allows investors to get reasonable discounts in some of the best companies in the economy. These discounts always come as a surprise, given that these companies’ stocks typically don’t trade near their lows. That’s why today’s list of stocks near their 52-week highs could come in handy for those looking for a bargain.
Since Wall Street analysts and the rest of the market have found enough reasons to bring these stocks back to their true value, investors now have ample opportunity to focus their attention on this potential recovery. Type names Target company New York Stock Exchange: TGT offer investors double-digit growth potential in the consumer discretionary sector after shares fell on recent earnings.
But the good news doesn’t end there. Investors can also head into the energy sector through Enphase Energy Inc. NASDAQ: ENF to align their portfolios with potential double-digit growth in the future. Finally, in the midst of the semiconductor industry drama, there is a better way to navigate the space with a greater margin of safety, which can be found in ASML Holding NASDAQ: ASML and its discounts from recent highs.
Upside potential of target stocks forces bears to abandon their positions
Goal today
(As of 10:34 a.m. ET)
- 52 week range
- US$120.21
▼
$181.86
- Dividend yield
- 3.50%
- P/E ratio
- 13.59
- Target price
- $160.30
Over the past month, even though Target shares traded up to only 72% of their 52-week high, the company’s short interest fell as much as 6.8%, showing signs of bearish capitulation, a symptom that could be the result of potential upside. who is waiting for the action.
While these short sellers may have been pleased to see their positions turning a profit, it appears that broader market trends have forced them to close out their positions, especially as bond prices have recently risen, pushing yields lower. Lower yields are always good for consumer trends; Target stock is no exception.
Wall Street analysts would agree, given that the current consensus estimate for Target stock is set at $160 per share. To prove this point correct, the stock would need to rise to 21.3% from where it is trading today, but it would still not come close to the year’s high of $181 per share.
Some institutional buyers, especially on State Street, may have replaced some of these short sellers who left the scene. As of November 2024, these investors increased their holdings of Target shares by 8.3%, bringing their net position to a maximum of $5.5 billion or 7.7% ownership in the company.
Enphase Energy Stock: How the New Energy Cycle Can Attract Investors
Enfaz Energy today
(As of 11/29/2024 ET)
- 52 week range
- $58.33
▼
$141.63
- P/E ratio
- 162.16
- Target price
- $101.13
When investors recognize that the decline in bond yields that will help drive the trend in Target stock is the same trend that will help drive up the price of oil, then the upside potential for Enphase Energy stock becomes clear.
There’s a reason Warren Buffett kept his Occidental Petroleum Co. New York Stock Exchange: OXY position despite the recent sell-off of other names. This is because he knows that the coming cycle will be favorable for oil prices. Likewise, solar energy stocks are likely to benefit from the most expensive oil, as counterintuitive as that may seem.
Higher oil prices will also increase fuel and electricity costs as they relate to each other on an annualized basis, meaning alternative – and cheaper – energy sources will become a more attractive proposition. Of all the alternative energy sources on the market today, solar energy has the largest adoption and penetration in the market.
That’s why JP Morgan Chase analysts maintained an Overweight rating on Enphase Energy shares and also maintained a $120 per share price target as of October 2024. To reach these valuations, Enphase Energy shares would have to rise as much as 63% from today’s levels.
With the company now trading at 51% of its 52-week high, the risk-reward scale here favors buyers over sellers.
Best risk/reward profile in ASML stock
ASML today
(As of 10:44 a.m. ET)
- 52 week range
- $645.45
▼
US$1110.09
- Dividend yield
- 0.81%
- P/E ratio
- 36.01
- Target price
- $961.00
After Super Micro Computer Inc. NASDAQ: SMCI fiasco and its threat Nvidia company. NASDAQ: NVDAShares of some semiconductor companies are trading lower amid market concerns. However, this is where ASML stock and its current level of just 64% from its 52-week high come into play.
Whether the risk implied for larger companies becomes a reality or not, the truth is that ASML shares are so undervalued that the potential upside far outweighs the potential risks of trading even lower. This is one of the facts that JP Morgan Chase analysts were also willing to confirm publicly.
As of October 2024, they maintained an Overweight rating on ASML shares and even set a $1,148 price target for the company despite the recent bearish price action. This would mean ASML shares are looking at a net gain of 71% for those willing to take another look at the company.
Moreover, markets remain willing to pay a premium for access to ASML’s financials, as evidenced by the stock’s price-to-book (P/B) ratio of 14.9x, especially compared to the computer sector’s average valuation of 7.1x. Markets typically overpay for stocks that they believe will easily outperform their peers in the coming quarters.
Before you consider the Super Micro Computer, you should hear this.
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