Tom Lee, Fundstrat managing partner, joined CNBC’s ‘Closing Bell’ on March 22 to discuss the current market sentiment. When asked about the recent report on tariffs, which oscillates between an iron fist and an olive branch, Lee expressed optimism. He suggested that markets should interpret the situation positively because many clients view tariffs as punitive and potentially recession-inducing. However, a mutually agreed or reciprocal tariff deal could create a favorable scenario for businesses, potentially setting the stage for a significant recovery rally. Addressing the immediate challenge of volatility leading up to April 2, Lee acknowledged the dilemma investors face during this period of uncertainty. He noted that many are overwhelmed by market fluctuations and tempted to give up. Drawing a parallel to the Cuban Missile Crisis in 1962, which lasted 12 days, Lee pointed out that markets historically bottom before crises are resolved. For instance, during that crisis, the stock market reached its lowest point seven days in and recovered two-thirds of its losses before the resolution. He suggested this historical pattern could serve as a template for today’s market behavior.
When asked about the economy, Lee remarked on how quickly sentiment has deteriorated. He attributed part of this decline to divisive political leadership that affected consumer confidence and noted that CEO confidence has also dropped unexpectedly. CEOs have become hesitant to make decisions, which is contributing to what he described as a growth shock. However, he remained hopeful that this slowdown would be temporary if it does not persist for months. The conversation shifted to concerns about a potential recession, with Jeffrey Gundlach recently estimating a 50% to 60% chance of one occurring in the next few quarters. Lee countered this by stating that while a 10% drawdown in the S&P 500 already prices in a 40% chance of recession, markets do not fully align with Gundlach’s pessimistic view. He highlighted that economies like China, Europe, Canada, and Mexico have been outperforming the US since February 18. If punitive tariffs were truly driving global recessions, these economies would also be struggling. Instead, Lee described markets as more paralyzed than outright pessimistic.
This environment highlights the importance of identifying promising stocks that could thrive as markets stabilize. That being said, we’re here with a list of the 12 best up and coming stocks to buy according to wall street analysts.
Photo by Roberto Júnior on Unsplash
Our Methodology
We used the Finviz stock screener to compile an initial list of the top stocks that went public in the last 5 years. We then selected the 12 stocks with high analysts’ upside potential as of March 21 that were also the most popular among elite hedge funds. The stocks are ranked in ascending order of their upside potential. We have also added the hedge fund sentiment for each stock, as of Q4 2024, which was sourced from Insider Monkey’s database.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
12 Best Up and Coming Stocks to Buy According to Wall Street Analysts
12. Sharkninja Inc. (NYSE:SN)
Average Upside Potential as of March 21: 51.01%
Number of Hedge Fund Holders: 63
Sharkninja Inc. (NYSE:SN) is a global product design and technology company. It operates under the Shark and Ninja brands and offers consumer solutions like cleaning, cooking, food preparation, beauty, and home environment appliances. Its products are sold through various retail and online channels.
In Q4 2024, the company’s net sales jumped 30% year-over-year, and adjusted net sales for the full year increased by 32%. This surge is attributed to successful launches in new product categories like coolers, fans, frozen drink appliances, and skincare. Products like the Ninja SLUSHi and Shark CryoGlow exceeded sales expectations and generated substantial social media buzz. The food preparation category also saw an 89% growth in Q4, which was fueled by popular items like CREAMi and SLUSHi.
Looking ahead, Sharkninja Inc. (NYSE:SN) plans to launch 25 new products in 2025 and projects a 10-12% increase in net sales for the year. The company is strategically targeting a $120 billion addressable market, which aims to disrupt established markets and capitalize on emerging consumer trends by continuing to innovate and expand its product portfolio.
The company’s strong revenue and margin growth, which was driven by successful product expansion, led to a significant stock rally and positive portfolio contribution. Artisan Small Cap Fund stated the following regarding Sharkninja Inc. (NYSE:SN) in its Q3 2024 investor letter:
“Among our top Q3 contributors were Guidewire, Veracyte and SharkNinja, Inc. (NYSE:SN). SharkNinja is a leading household consumer products company. Its Shark brand focuses on the cleaning category (vacuums, mops, carpet cleaners, etc.) and, more recently, beauty (hair dryers, hair stylers, etc.). Its Ninja brand focuses on food preparation (blenders, food processors, ice cream makers, juicers, etc.) and cooking (indoor grills, ovens, toasters, cookers, air fryers, etc.). We believe a healthy combination of market share gains within existing categories, new category entries and international expansion will drive growth. Shares rallied after reporting strong earnings results, including 31% revenue growth and 600bps of gross margin expansion.”
11. Constellation Energy Corp. (NASDAQ:CEG)
Average Upside Potential as of March 21: 53.57%
Number of Hedge Fund Holders: 85
Constellation Energy Corp. (NASDAQ:CEG) generates and sells energy products and services across the US. With a portfolio of nuclear, wind, solar, natural gas, and hydroelectric assets, it supplies electricity and natural gas to a range of customers. These include utilities, municipalities, and residential consumers.
On February 24, DBS analyst Elizabelle Pang reaffirmed a Hold rating for the company with a price target of $300. While acknowledging the company’s growth potential, the Hold rating reflects concerns about current market risks. However, the firm highlighted that the company’s acquisition of Calpine Corporation, which was driven by the increasing demand from AI data centers and the electrification of transportation and buildings, holds great importance for the company’s future.
The company’s nuclear power generation is central to meeting the surging electricity demands of AI data centers and other high-energy technologies. The company’s nuclear fleet, which is the largest producer of emissions-free energy in the US, achieved a 94.6% operating capacity factor in 2024. In Q4 2024 alone, nuclear plants generated 45,494 gigawatt-hours. Constellation Energy Corp. (NASDAQ:CEG) also has a 20-year power purchase agreement with Microsoft for the Crane Clean Energy Center.
The company’s position as the largest US clean energy producer, particularly in nuclear power, combined with rising electricity demand from AI and data centers, led to significant share performance gains. Alger Mid Cap Focus Fund stated the following regarding Constellation Energy Corp. (NASDAQ:CEG) in its Q3 2024 investor letter:
“Constellation Energy Corporation (NASDAQ:CEG) is the largest producer of clean energy in the U.S., with 32,400 Megawatts of capacity, 87% of which is nuclear generated. Its nuclear, hydro, wind, and solar facilities provide 10% of all clean energy on the U.S. grid and 22% of its clean baseload power. We believe the company stands to benefit from the increasing electrification of the U.S. economy. The rise of electric vehicles, data centers, and reshoring of American manufacturing is driving U.S. electricity load growth for the first time in nearly two decades. In our view, AI workloads are projected to significantly increase energy demand from data centers over the next few years. As American enterprises seek clean and reliable energy sources, nuclear power, which is carbon-free and dependable, stands out compared to intermittent renewables like wind and solar. Constellation, as an unregulated independent power producer, benefits from low fixed costs and can capture upside from rising electricity prices. We believe that potential opportunities for earnings growth include colocation (data centers near nuclear plants) and energy-matching programs with cloud providers willing to pay premium prices for nuclear energy. The Inflation Reduction Act also provides downside protection through a guaranteed minimum price for nuclear generation. During the quarter, shares contributed to performance from two events: 1) annual electricity auctions revealed tightening markets driven by increasing demand, driving higher pricing in the Middle Atlantic states, leading management to raise their fiscal 2024 earnings projections. 2) On September 20, 2024, Constellation Energy announced the signing of a 20-year power purchase agreement with Microsoft, which includes restarting Three Mile Island’s Unit 1 to supply energy.”