Connect with us

Business

2 Buy-Rated Stocks That Are Too Cheap to Ignore, According to These Analysts

News Agencies

Published

on

Bad is good and good is bad. No, that’s not an extract from Orwell’s 1984, but rather the stock market’s view of the jobs market at the end of 2022.

Friday’s better-than-expected jobs numbers put a spanner in the works for investors hoping the Fed will start easing its aggressive monetary stance when it convenes midway through the month to decide on its course of action. A strong jobs market is the opposite of what the Fed is looking for as it continues in its efforts to tame inflation. Therefore, the figures have sown renewed fears amongst investors worn out by 2022’s bear that another 75-basis-point rate hike – rather than a more moderate 50-basis-point increase – is in the cards.

It remains to been seen what the Fed’s decision will be, but in any case, 2022’s negative market action has resulted in many stocks already dropping to some very enticing levels. In fact, some Street analysts believe a couple of stocks are down to a level that makes them just too cheap to ignore right now. We ran these Buy-rated tickers through the TipRanks database to get a more comprehensive overview of their prospects. Let’s check the details.

Opera, Ltd. (OPRA)

Advertisement

We’ll start with a small-cap software firm that has built a reputation for quality. Opera got its start more than 25 years ago, bringing the best in developers, coders, researchers and marketers to the early stages of the online world. Today, the company is known for its array of top-end online products, including game making software, a wide range of mobile social apps from chat to news feeds, VPN tech, online entertainment streaming, and innovative browsers for both desktop and mobile.

All of this has brought Opera upwards of 321 million active monthly users, in a customer base that spans the globe. Opera is always looking for ways to add value to its products, and last month announced that its browser was the first to include TikTok as a built-in sidebar feature.

Opera’s recent report on Q3 financial results showed a strong year-over-year gain in revenue, from $66.6 million to $85.3 million, or an increase of 28%. Net income fell, however, from $23.5 million to $9.4 million. By EPS, the adjusted income drop was 26 cents to 10 cents per diluted share. While net income fell in the quarter, Opera felt comfortable enough to raise its full-year revenue guidance for 2022, from $316 million to $324.5 million at the midpoints; achieving this will result in a 29% y/y revenue gain.

Advertisement

Despite the overall sound Q3 results, shares in Opera are down by 28% so far this year and Lake Street Capital Mark Argento smells opportunity. In short, the analyst believes that OPRA shares are crazy-cheap, and doesn’t shy from saying so: “While many stocks are cheap, this one takes the cake. To say that shares are dirt cheap is an understatement…. Given the unique nature of the company, its geography, and its business, investors have overlooked a business that is growing top line organically and has significant market penetration opportunities in developed counties. Even taking an ultra-conservative approach to an enterprise value calculation, OPRA is still trading at a double-digit free cash flow yield…. While we understand shares should trade at a discount to some of their larger internet/media peers, 1x EBITDA is absurd and is not sustainable.”

Argento, of course, puts a Buy rating on OPRA, and his price target, set at $11, implies a robust upside potential of 117% for the next 12 months. (To watch Argento’s track record, click here)

Advertisement

While there are only 3 recent analyst reviews on Opera’s stock, they all agree that it’s one to buy – giving the shares a unanimous Strong Buy consensus rating. The stock is priced at $5.06 and has an average price target of $10.57, suggesting a one-year gain of 109%. (See OPRA stock forecast at TipRanks.)

Yeti Holdings (YETI)

Next up, Texas-based Yeti. The company got its start in 2006, producing, marketing, and distributing a line of high-quality outdoor goods and gear, including its lines of insulated bags, coolers, and cups, as well as outdoor apparel for winter weather, and even rugged bowls and beds for dogs on the trail. Yeti has expanded from its relatively modest beginning into a large firm with a market cap of $3.8 billion and a devoted following among campers, fishers, and hunters. The company’s products are available through its network of brick-and-mortar stores, as well as through its online e-commerce site.

YETI shares have lost 43% year-to-date, a loss that is significantly deeper than the 14.5% decline in the S&P 500 over the same time. However, the stock has been paring back the losses recently, boosted by a strong Q3 showing.

Advertisement

Yeti posted a 20% y/y increase in sales from 3Q21 to 3Q22, from $362.6 million to $433.6 million. The company’s direct to consumer (DTC) sales were up 15% y/y, and made up 52% of the total. Yeti’s wholesale channel sales were up 25% y/y, to $206.2 million. During 3Q22, the company saw strong sales in Coolers & Equipment, especially the soft and hard coolers, and bags. The Coolers & Equipment segment was up 25% y/y, from $149 million to $185.7 million.

The top-line figure beat Street expectations, and likewise on the bottom-line; the company delivered adj. EPS of $0.63, edging ahead of the $0.59 forecast.

Brian McNamara chimes in from Canaccord Genuity, and he likes what he sees here; the company’s solid product line and large total addressable market lead him to describe this firm as “the ‘Nike’ of innovative outdoor products.”

Advertisement

Assessing the company’s prospects, McNamara said, “We believe this is a long-term growth story of a brand that is still underpenetrated in many parts of the U.S., while a nascent international business should be a disproportionate contributor of growth moving forward…. we believe market expectations are overly conservative…. we find the de-rating over the last year overdone and would encourage investors to use the underperformance as an opportunity to purchase this iconic global lifestyle brand at a discount.”

McNamara’s comments back up his Buy rating on the stock, and his $58 price target indicates potential for 23% upside on the one-year time frame. (To watch McNamara’s track record, click here)

The Moderate Buy consensus rating on YETI is based on 12 recent Wall Street reviews, which include 8 Buys and 4 Holds. The stock is selling for $46.99 and its $54.09 average price target suggests a gain of 15% for the next year. (See YETI stock forecast at TipRanks)

Advertisement

To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a tool that unites all of TipRanks’ equity insights.

Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.

Continue Reading
Advertisement

Advertisement

Breaking News

Editor Pick’s

Latest Entertainment

Entertainment42 mins ago

‘One Of Us Is Lying’ & ‘Vampire Academy’ Cancelled At Peacock

EXCLUSIVE: A pair of YA drama series are coming to an end at Peacock. The NBCU streamer has canceled One...

Entertainment2 hours ago

Brooke Shields reveals details of sexual assault in new Sundance documentary: ‘First time I’ve ever spoken about what happened’ ‘

Brooke Shields arrives for the National Board of Review Awards Gala in New York City on January 8, 2023. (Photo...

Entertainment3 hours ago

Jason Momoa Teases More ‘Aquaman’, DC Universe Future & David Zaslav Sit-Down

“I love [James] Gunn and so there’s gonna be some really cool things, what they’re doing with DC, and I...

Entertainment3 hours ago

‘NCIS: Los Angeles’ To End With Season 14 On CBS; Series Finale Date Set

One of CBS’ longest-running scripted shows, NCIS: Los Angeles, will be coming to an end after 322 episodes. Its current...

Entertainment3 hours ago

David Crosby’s 10 Best Songs

David Crosby, Legendary Musician With The Byrds and Crosby, Stills, Nash & Young, Dies at 81 David Crosby, who died...

Entertainment3 hours ago

Hilaria Baldwin pleads with paparazzi to ‘leave my family in peace’ following news that husband Alec will be charged in ‘Rust’ shooting

Hilaria and Alec Baldwin married in 2012. (Photo: Mike Coppola/Getty Images for 2022 Robert F. Kennedy Human Rights Ripple of...

Entertainment6 hours ago

Steven Spielberg & Imagine Teaming For John Williams Documentary Feature

Cue the menacing tuba. And the Imperial March. And the rousing Indiana Jones theme. Five-time Oscar-winning composer John Williams is...

Entertainment7 hours ago

Meghan McCain and Husband Ben Domenech Welcome Second Baby Girl, Daughter Clover Jade

Meghan McCain is officially a mom of two! The former View co-host and husband Ben Domenech have welcomed a baby girl, the couple...

Advertisement

Latest Sports

Sports25 mins ago

Milwaukee Bucks trade rumors tracker: Serge Ibaka wants out, Jae Crowder on deck?

Track all of the latest Milwaukee Bucks trade rumors, from Serge Ibaka to Jae Crowder to Cam Reddish.

Sports54 mins ago

Neutral site conference title games not fan-tastic

A Chiefs-Bills AFC title game would be incredible. The NFL getting to test run a neutral site championship game that...

Sports1 hour ago

What may hurt Alabama’s Bryce Young in NFL draft – and it’s not height, analyst says | Goodbread

Will Alabama football quarterback Bryce Young's size hurt his NFL draft status? Here's what one analyst said Friday

Sports2 hours ago

How MLB coaches, pitchers, hitters are adapting a new strategy for pick-off limits

One side effect of the pitch timer will be the game within the game that is pickoff strategy.

Sports2 hours ago

Mr. Irrelevant Isn’t Brock Purdy, It’s a $1M Charity Operation

One week last summer Brock Purdy learned to surf, rode an outrigger canoe with a group of Olympic paddlers, went...

Sports2 hours ago

NBA admits refs missed five OT calls that hurt Warriors vs. Celtics

The Warriors' overtime loss to the Boston Celtics on Thursday night at TD Garden was heartbreaking in itself, but Dub...

Sports3 hours ago

Ravens woo Lamar Jackson with input on OC hire, hope for contract extension I The Rush

Multiple NFL coordinators were fired on Thursday, including Byron Leftwich being released by the Buccaneers and Greg Roman, who was...

Sports3 hours ago

Report: Top WNBA free agent Breanna Stewart to meet with 4 teams

The two-time WNBA champion will reportedly take the meetings in Istanbul, where she is currently playing.

Technology Hot News

Technology2 days ago

Led by "Amazon" and "Microsoft" .. the technology giants are planning to lay off 64,000 employees

After 10 years of driving the stock market bull run, big tech companies are racing to downsize staff to adapt...

Technology2 days ago

Apple introduces MacBooks with new M2 processors

Yesterday, Tuesday, Apple unveiled MacBooks powered by the new, faster “M2 Pro” and “M2 Max” processor chips, in a surprise...

Technology3 days ago

All you need to know about the upcoming Galaxy S23 phones from Samsung

Samsung has officially announced that the (Galaxy Unpacked 2023) event will be held this year on Wednesday, February 1, which...

Technology3 days ago

FTX Exchange Announces Hacking and Stolen $415 Million in Cryptocurrency

Bankrupt American cryptocurrency firm FTX announced today, Wednesday, that $415 million in cryptocurrency has been hacked and stolen from the...

Technology3 days ago

Because of a "fraudulent tweet"… Elon Musk's trial begins

Elon Musk's trial began Tuesday in San Francisco with the selection of jury members who will have to decide whether...

Technology3 days ago

An electric spoon replaces salt and spices, but with conditions

Experts have developed an electric spoon that is able to replace spices and flavors and affect the taste buds in...

Technology6 days ago

The biggest dangers of using tracking devices.. so you can escape?

If you spot an unknown Bluetooth tagging device, there are ways to disable the device so it can't track your...

Technology6 days ago

New Twitter.. For You tab to web version

The Twitter platform announced that it will bring the new tab (For You), which launched last Tuesday for iPhones and...

Advertisement