In this article, we discuss the 5 stocks to buy before their earnings reports. If you want to read about some stocks with upcoming growth catalysts, go directly to 10 Stocks to Buy Before Their Earnings Reports.
5. Verizon Communications Inc. (NYSE:VZ)
Number of Hedge Fund Holders: 63
Earnings Due On: April 22
Verizon Communications Inc. (NYSE:VZ) markets technology, information, and entertainment products. The company has signaled that it is ready to push for labor retention in a tricky market as it recently announced that it had boosted the minimum wage for a large number of employees to $20 per hour. Verizon announced that it was offering premium pay differentials for managers who work on holidays. The firm is expanding partnerships with key firms in the 5G sector as well, evidenced by the investment in communications equipment firm Casa Systems.
In late January, Deutsche Bank analyst Bryan Kraft maintained a Hold rating on Verizon Communications Inc. (NYSE:VZ) stock but raised the price target to $59 from $57, predicting an 8% upside in the shares in 2022.
At the end of the fourth quarter of 2021, 63 hedge funds in the database of Insider Monkey held stakes worth $10.8 billion in Verizon Communications Inc. (NYSE:VZ), compared to 57 in the previous quarter worth $10.3 billion.
In its Q4 2021 investor letter, ClearBridge Investments, an asset management firm, highlighted a few stocks and Verizon Communications Inc. (NYSE:VZ) was one of them. Here is what the fund said:
“Over the last year, we have repositioned our portfolio to navigate the course we see ahead. We added to more defensive areas of the portfolio like telecom (Verizon). While the next month or two will likely prove choppy on account of the Omicron variant, we believe that Omicron, like Delta, represents a speed bump on the way to recovery rather than a true change in course. We see strong economic momentum continuing in 2022 and we expect interest rates to rise. After a decade of remarkably low rates, we would not be surprised if this change in direction is accompanied by some fits and starts in the markets. With our emphasis on pricing power, purposeful sector exposure, valuation discipline, and a strong dividend profile, we believe we are well-positioned for the year ahead.”
4. Abbott Laboratories (NYSE:ABT)
Number of Hedge Fund Holders: 64
Earnings Due On: April 20
Abbott Laboratories (NYSE:ABT) makes and sells healthcare products. On March 24, the company announced that it had won a $1 billion contract from the US Army for the supply of COVID-19 rapid antigen tests. The company plans to finish the project by the end of June this year. The stock has also benefited from the decision by the authorities in the US to extend the COVID-19 emergency by another two weeks in the area. The company is based in Chicago and employs over 1,000 people.
On March 1, Bank of America analyst Travis Steed reinstated coverage of Abbott Laboratories (NYSE:ABT) stock with a Buy rating and a price target of $140, noting that the company was offering investors a “sustainable top-quartile organic growth profile”.
Among the hedge funds being tracked by Insider Monkey, Ohio-based investment firm Diamond Hill Capital is a leading shareholder in Abbott Laboratories (NYSE:ABT) with 6 million shares worth more than $851 million.
In its Q4 2021 investor letter, Richie Capital Group, an asset management firm, highlighted a few stocks and Abbott Laboratories (NYSE:ABT) was one of them. Here is what the fund said:
“Abbott Laboratories (NYSE:ABT) – Abbot Labs continues to benefit from resurging demand for Covid testing kits. The company is planning to increase their monthly production of BinaxNOW athome rapid tests to 100M a month, a 43% increase from current levels.”
3. HCA Healthcare, Inc. (NYSE:HCA)
Number of Hedge Fund Holders: 66
Earnings Due On: April 22
HCA Healthcare, Inc. (NYSE:HCA) provides health care services. At the beginning of this year, the company had announced that it would be building five new full-service hospitals in Texas. HCA already operates 45 hospitals and 632 affiliated sites that cater to health needs of different types of patients. The increase in the aging population has given a slight boost to the stock in the past few months. Over the last year, the shares have jumped 33%.
On March 28, Wells Fargo analyst Ste Baxter initiated coverage of HCA Healthcare, Inc. (NYSE:HCA) stock with an Equal Weight rating and a price target of $267, noting that the firm was a “best-in-class” hospital company with a strong record of growth.
At the end of the fourth quarter of 2021, 66 hedge funds in the database of Insider Monkey held stakes worth $2.9 billion in HCA Healthcare, Inc. (NYSE:HCA), compared to 72 the preceding quarter worth $3.3 billion.
In its Q3 2021 investor letter, First Eagle Investment Management, an asset management firm, highlighted a few stocks and HCA Healthcare, Inc. (NYSE:HCA) was one of them. Here is what the fund said:
“HCA Healthcare, Inc. (NYSE:HCA) owns and operates 185 hospitals and approximately 2,000 sites of care in the US and UK. Admissions to its facilities, depressed during the worst of the Covid-19 outbreak in 2020, have begun to rebound. HCA Healthcare, Inc. (NYSE:HCA) reported a nearly 20% year-over-year increase in admissions during the second quarter and a 14% increase in revenue, and forecast that volume would continue to improve throughout the year. We maintain our positive opinion of the company’s management team, believing them to be effective stewards of both the balance sheet and HCA’s business operations.”
2. AT&T Inc. (NYSE:T)
Number of Hedge Fund Holders: 70
Earnings Due On: April 21
AT&T Inc. (NYSE:T) is a media, communications, and technology firm. The company recently closed a merger deal that resulted in the unison of the WarnerMedia business of the firm with the Discovery business. Analysts have been bullish on the firm after the spin-off. On April 12, Raymond James analyst Frank Louthan predicted that the stock would witness more institutional interest as a result of the spin-off. However, the analyst also cautioned against the stock being “recession-proof”.
On April 13, Morgan Stanley analyst Simon Flannery kept an Overweight rating on AT&T Inc. (NYSE:T) stock with a price target of $21, highlighting that there was caution around wireless carriers ahead of the first quarter as promotions were likely to weigh on metrics.
At the end of the fourth quarter of 2021, 70 hedge funds in the database of Insider Monkey held stakes worth $4.9 billion in AT&T Inc. (NYSE:T), compared to 66 in the preceding quarter worth $3.2 billion.
In its Q4 2021 investor letter, Weitz Investment Management, an asset management firm, highlighted a few stocks and AT&T Inc. (NYSE:T) was one of them. Here is what the fund said:
“After several quarters of pandemic-induced outsized growth, new broadband connection growth has slowed for U.S. cable operators. This slower growth has coincided with a renewed push by competitors like Verizon and AT&T Inc. (NYSE:T) to offer high-speed data (either via wireless connects or by building new fiber-optic networks).”
1. Tesla, Inc. (NASDAQ:TSLA)
Number of Hedge Fund Holders: 91
Earnings Due On: April 20
Tesla, Inc. (NASDAQ:TSLA) makes and sells electric vehicles and clean energy equipment. Cathie Wood, the chief of ARK Investment Management, has said that the shares of the EV maker will hit around $4,600 within the next five years. Tesla is one of the largest holdings in the ARK portfolio. Reports suggest that the company is also planning to resume EV production at a plant in Shanghai that had been shut as a result of virus restrictions in some parts of the Asian country over the past few weeks.
On April 8, Wedbush analyst Daniel Ives kept an Outperform rating on Tesla, Inc. (NASDAQ:TSLA) stock with a price target of $1,400, noting that the launch of the Cyber Rodeo was an important achievement for the company.
At the end of the fourth quarter of 2021, 91 hedge funds in the database of Insider Monkey held stakes worth $12.9 billion in Tesla, Inc. (NASDAQ:TSLA), compared to 60 in the previous quarter worth $10.6 billion.
Here is what Worm Capital has to say about Tesla, Inc. (NASDAQ:TSLA) in its Q1 2022 investor letter:
“Over the last several months, we have become increasingly bullish on Tesla, Inc. (NASDAQ:TSLA), our largest holding. As an expression of our increased confidence, through Q1 we increased our Tesla, Inc. (NASDAQ:TSLA) position. At a high level, we believe Tesla is on a path to dominate the S&P 500. Much like Amazon emerged from the Nasdaq Bubble and the Financial Crisis, we think Tesla has at least another 10 years of growth ahead, and it is just now hitting its inflection point of accelerated, rapid growth.
At the same time, consensus estimates of Tesla’s growth are, in our view, extremely low. This dynamic, in our opinion, will likely result in consistent upwards revisions to expectations, creating one of the more dramatic arbitrage investment opportunities we have ever come across. From a data, scale, and advanced manufacturing perspective, the company is entering escape velocity. To be clear, Tesla’s stock price and market value is no longer a reflection of anticipated success. It reflects its current success and proven ability to generate substantial earnings and record-setting cash-flows at scale. In sum: It’s early days. We’ll soon be publishing a comprehensive research report on Tesla, Inc. (NASDAQ:TSLA). Stay tuned.”
You can also take a peek at 10 Best Medical Companies Under $10 and 15 Best Warren Buffett Companies to Buy Now.
