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Raymond James: These 3 stocks are about to climb over 80%
We are a little over a week after the presidential election, and the market reaction shows that investors are happy. As the electoral margins were thin as a razor, the will of the voters manifested themselves: they rejected Donald Trump and his brash style, but they also rejected the Democratic Party on politics; Democrats have lost seats in the House, are unlikely to take control of the Senate, and have also lost ground at the state level. American voters seem to have had enough of the drama, whether it comes from Donald Trump or the Democrats’ push to the political left. They want a government that will just walk straight ahead, and it looks like they will get just that. With the division of power in the White House and the Houses of Congress, we are about to remember one feature of the system of checks and balances: This stalemate is the result of a tightly divided electorate. Change will only happen if one side or the other obtains a large majority, or a small majority over several terms. None of these elements are planned at the moment. The immediate result is a market rally over several days. The implication is clear: Market sentiment has calmed down since the election, and investors anxiously await the government to settle into a more normal fashion in the months to come. To this end, investors are sure to find solid options in the short term. Written by Raymond James, analyst Ric Prentiss recently published three reviews of mid-cap stocks, highlighting why he believes they offer high return potential with more stable markets in the coming year. Equities all fit a profile: they are in the lower end of the mid-cap range, with market valuations of between $ 2 billion and $ 3 billion; they inhabit the telecom ecosystem, and they all have, according to Raymond James, an upside potential of over 80%. We scoured the TipRanks database to see what other Wall Street analysts have to say about them. Telephone & Data Systems (TDS) First on our list, Telephone & Data Systems, is a Chicago-based company that offers a range of telecommunications services. to more than 6 million customers. The company offers cable and wireline broadband services, wireless products and services, as well as television and voice services. TDS operates the nation’s fifth-largest mobile operator, and TDS has significantly exceeded expectations in 2020, despite the ongoing coronavirus. Revenue, at $ 1.32 billion, was roughly on par with the pre-corona report ($ 1.34 billion in Q4 2019), while profits surged in 1Q20 and have remained high since. . Third quarter profit, at 66 cents, beat the forecast by 153%. It was an impressive performance, bolstered by the 266% year-over-year growth. Another good note for investors, TDS maintained its payment of dividends throughout the year. The payout of 17 cents per common share cancels out to 68 cents and delivers a 3.6% return, nearly double the average return of publicly traded companies S & P.TDS has shown strong activity throughout of the year, but its weak point was fiber and cord niche. However, Raymond James’ Ric Prentiss examines the half-full glass, noting, “WFH policies continued to result in slower approvals from municipalities and electric utilities associated with building overhead fiber. And in some cases, TDS is looking to alternatives with TDS Telecom has increased its fiber service addresses by 5% year-on-year and is recording better-than-expected purchase rates of around 30-40%, depending on the market. In addition, 34% of wireline customers are now served by fiber, up from 29% a year ago, and TDS expects an acceleration throughout the remainder of 2020. “Prentiss rates TDS as a strong buy. and raised his price target 6% to $ 34. At that level, he sees an 81% rise for the stock over the next few months. (To see Prentiss’ track record, click here) This stock also holds a strong buy rating from analyst consensus, based on 3 unanimous buy reviews established in recent weeks. Shares are priced at $ 18.73 and the average target of $ 34.83 suggests a rise in ‘one year 85.5%. (See TDS stock market analysis on TipRanks) ViaSat, Inc. (VSAT) Next, ViaSat, is a broadband satellite provider. The California-based company serves the commercial and defense markets, building on the vast need in all sectors for secure communications Social lockdown measures have had a huge impact negative on the company’s activities, in particular airline closures. Commercial air traffic relies heavily on satellite communications and this slowdown still weighs on ViaSat. The headwinds are partially offset by a backlog of ordered services. Revenue has been flat over the past four quarters at between $ 530 million and $ 588 million, with the $ 554 million in the third quarter sitting firmly in the middle of that range. Profits rebounded in positive territory after turning negative in Q2. Third-quarter EPS was only 3 cents, but it was a dramatic sequential improvement from the previous 20-cent net loss. In his look at VSAT, Prentiss notes, “Government systems and business networks remain strong, while IFC’s business continues to navigate. significant headwinds linked to COVID-19… On the bright side, social distancing and safer home policies are driving greater residential broadband data usage and pushing ARPUs higher… ”Prentiss rates VSAT outperformance ( ie upside potential of 87%. Overall, ViaSat obtains a moderate buy rating from analyst consensus, based on 3 opinions including 2 buys and 1 hold. Average price target of $ 53.33, which implies a 12-month increase of 59% from the trading price of $ 33.39. (See VSAT market analysis on TipRanks) EchoStar Corporation (SATS) Latest but not least is EchoStar, another satellite operator. This company controls a constellation of communications satellites, providing satcom capabilities to media and private companies, as well as US civil and military government agencies. In addition, EchoStar four nit satellite broadband to 100 countries around the world.At top, EchoStar’s revenue has held steady over the past three quarters, reaching $ 465 million, $ 459 million and $ 473 million . And while earnings were negative in Q1 and Q2, Q3 results showed net profit of 26 cents per share. Q3’s sequential improvements up and down are accompanied by an increase in the base of EchoStar subscribers, to over 1.54 million in total. . The company also has a strong balance sheet, with more than $ 2.5 billion in cash and no net debt. He writes: “SATS [has] strategic optionality at a time when others, particularly high-leverage satellite companies, are cash-strapped in the face of large deadlines or capex programs … we believe a number of Organic and inorganic growth options are being considered, including the future deployment of the SBand spectrum after aligning the primary tenant (s). Finally, we believe that the recently announced collaboration between EchoStar and Inmarsat to provide in-flight connectivity capability is expected to deliver high margin cash flow over time, and we note that the deal is not exclusive. The comments support another Strong Buy rating, and Prentiss’ target price of $ 57 indicates a 123% improvement margin next year. As for other analyst activities, it has been relatively calm. The 1 Buy and 1 Hold ratings assigned during the last three months correspond to a consensus of analysts “Moderate buy”. Additionally, the average price target of $ 43.50 places the upside potential at ~ 74%. (See SATS Stock Market Analysis on TipRanks) To get great ideas for stocks traded at attractive valuations, visit Top Stocks to Buy from TipRanks, a newly launched tool that brings together all the stock information from TipRanks. 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.
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