In this article, we will discuss the 10 stocks whose price targets were recently raised by analysts. If you want to see more such stocks on the list, go directly to Analysts Are Increasing Price Targets of These 5 Stocks.
As the Federal Reserve approaches the end of its rate-hiking cycle, investors are reconsidering shares of dividend-rich companies. The Fed’s aggressive rate increases have lifted short-term Treasury yields above 5%, providing income-seeking investors with more options after a decade of historically low rates. This has affected popular dividend-paying stocks, which were favored during lower-rate periods. With the expectation that the Fed will not raise rates significantly further, dividend payers are becoming appealing again, especially if Treasury yields decline. According to Reuters, some investors are shifting their focus to financial and energy stocks, anticipating an economic soft landing rather than a painful recession. A resurgence of interest in dividend-paying stocks is evident in inflows to the ProShares S&P 500 Dividend Aristocrats ETF, which tracks companies with a consistent history of increasing dividends. However, S&P 500 companies have been less generous to investors this year, with lower oil prices leading some energy companies to cut back on payouts. Despite this, investors seek out dividend-paying stocks as a source of total return, betting on potential faltering bond yields while stocks continue to perform well. Additionally, the appeal of dividend payers is attributed to a broadening of the market rally from tech and growth stocks into other sectors, such as energy and financials.
On the real estate front, the market is grappling with challenges in both residential and commercial segments, primarily influenced by higher interest rates. Despite this shared obstacle, distinct factors are driving residential and commercial real estate prices differently. Residential real estate has experienced a remarkable surge, with median home prices in the U.S. rising by 50.7% in 2.5 years to a record high of $413,800 in June 2022. Although home prices slightly pulled back to just over $396,000 in May 2023, there are concerns about low inventory, reluctance to switch to higher-rate mortgages, declining affordability, and tighter credit availability affecting the market. On the other hand, the commercial real estate market faces challenges due to the pandemic’s impact, leading to high office vacancy rates in major cities. According to Wells Fargo Advisors, small businesses relying on downtown foot traffic are suffering, and new lease rates are declining in many markets. Consequently, the commercial real estate sector’s outlook remains unfavorable, with expectations of further deterioration in the near-to-intermediate term, warranting caution for investors and stakeholders.
Oil prices have been holding steady near a three-month high, largely driven by positive signals from China’s efforts to bolster its economic growth and the continued tightening of the global crude market. China, as the world’s largest crude oil importer, plays a crucial role in influencing oil prices, and recent indications from the country’s top leaders have provided support to the market. One contributing factor to the bullish outlook for oil prices is the US crude’s notable achievement of closing above its 200-day average. This technical milestone has added to the positive sentiment among investors and analysts, signaling potential further upside in the oil market. Specifically, Brent crude futures have been maintaining a price above $82 a barrel in the London market, reflecting a substantial 4% gain over the last three trading sessions. Such upward momentum suggests growing confidence among traders in the short-term prospects for oil prices.
China’s commitment to supporting its real estate sector and boosting consumption is another significant development influencing the oil market. The country’s leaders have demonstrated their intention to provide support to the property market without resorting to major fiscal or monetary loosening measures. This approach is likely aimed at maintaining stability while addressing key economic challenges and supporting sustainable growth. The combination of China’s supportive measures and the ongoing tightening of the global crude market is contributing to the overall stability and optimism in the oil market. Investors and industry experts are closely monitoring these developments as they shape the trajectory of oil prices in the near future. The steady performance near a three-month high and the recent bullish sentiment provide some reassurance to market participants and may encourage further investment in the oil sector. However, uncertainties persist, and geopolitical factors and supply-demand dynamics will continue to play a crucial role in determining the future trajectory of oil prices.
On the stock market front, analysts are bullish on tech stocks such as Apple Inc. (NASDAQ:AAPL) and Microsoft Corporation (NASDAQ:MSFT) along with healthcare stock Abbott Laboratories (NYSE:ABT). Check out the complete article to see the details of these upward revisions in price targets.
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10. Intel Corporation (NASDAQ:INTC)
Upside Potential: N/A
Intel Corporation (NASDAQ:INTC) holds the title of the world’s leading chip manufacturer. However, the company has recently faced challenges in maintaining its technological advantage. Many experts are closely monitoring Intel’s decision to adopt a new approach of allowing other companies to use its manufacturing plants and actively pursuing new technologies. The outcome of this strategy is eagerly awaited to determine if it will bring positive outcomes for the company.
On July 24, Mizuho analyst Rakesh raised the price target for Intel Corporation (NASDAQ:INTC) from $30 to $33. This adjustment comes as Rakesh cites an overall improvement in the semiconductor sector’s price-earnings multiple, indicating a positive trend in the industry. Rakesh’s rationale for the price target increase includes the potential for Intel Corporation (NASDAQ:INTC) to benefit from the ongoing AI (Artificial Intelligence) revolution. While he believes that Intel Corporation (NASDAQ:INTC) could generate some additional revenue from this technological wave, he also notes that the company’s growth may be more subdued compared to its competitors in the semiconductor market. The revised price target of $33 suggests that Mizuho sees potential for Intel Corporation (NASDAQ:INTC) stock to appreciate further in the future, based on its assessment of the company’s performance and its position within the semiconductor industry.
09. Johnson & Johnson (NYSE:JNJ)
Upside Potential: 2%
Johnson & Johnson (NYSE:JNJ) is an American multinational corporation founded in 1886 that is known for developing medical devices, pharmaceuticals, and consumer packaged goods. On July 24, Barclays raised the price target for Johnson & Johnson (NYSE:JNJ) to $175 per share, up from the previous target of $171. This upward revision in the price target indicates Barclays’ positive outlook on Johnson & Johnson (NYSE:JNJ) stock and its potential for further growth. The new price target of $175 reflects Barclays’ belief that Johnson & Johnson (NYSE:JNJ) shares have the potential to reach that level in the future, signaling their confidence in the company’s fundamentals and future performance.
ClearBridge Large Cap Value Strategy made the following comment about Johnson & Johnson (NYSE:JNJ) in its first quarter 2023 investor letter:
“The tech-dominated quarter was a headwind for both defensive and cyclical sectors, with shares of health care holdings such as UnitedHealth Group (UNH), Elevance (ELV) and Johnson & Johnson (NYSE:JNJ) declining after a strong 2022.”
08. Airbnb, Inc. (NASDAQ:ABNB)
Upside Potential: 8%
Airbnb, Inc. (NASDAQ:ABNB) is a travel services company that provides lodging options to travelers who are not interested in staying at hotels. It is one of the more popular companies and one that has disrupted the real estate sector. It enables property owners to temporarily rent out their properties to travelers and other users. The firm was set up in 2007 and is based in San Francisco, California. On July 24, KeyBanc analyst Justin Patterson significantly increased the projected price target for Airbnb, Inc. (NASDAQ:ABNB) shares, raising it from $135 to $160. The basis for this optimistic adjustment lies in the observed resurgence of travel expenditures, indicating a reacceleration in the travel industry. As a result of their analysis and confidence in the company’s potential, KeyBanc maintained an overweight or buy rating on Airbnb, Inc. (NASDAQ:ABNB) stock. This update from KeyBanc demonstrates a strong belief in Airbnb, Inc. (NASDAQ:ABNB) growth prospects, indicating that the company is poised to benefit from the rebounding travel sector.
07. Baker Hughes Company (NASDAQ:BKR)
Upside Potential: 12%
On July 24, Baker Hughes Company (NASDAQ:BKR) received a favorable review from analyst Chase Mulvehill, who is associated with BofA Securities. In his recent assessment of Baker Hughes Company (NASDAQ:BKR), Mulvehill reaffirmed his positive stance on the company by maintaining a Buy rating on its stock. Furthermore, he made an upward revision to the price target, raising it from $38 to $40. This suggests that he expects the stock to perform even better in the future and has confidence in its potential to provide attractive returns to investors. Mulvehill’s positive review and price target increase highlight his belief in Baker Hughes Company (NASDAQ:BKR) growth prospects and ability to navigate its industry’s challenges and opportunities.
ClearBridge Mid Cap Growth Strategy made the following comment about Baker Hughes Company (NASDAQ:BKR) in its Q4 2022 investor letter:
“We established a new position in Baker Hughes Company (NASDAQ:BKR), in the energy sector, which provides technological support and services to energy and industrial companies including oilfield services, oilfield equipment, turbomachinery and process solutions and digital solutions. We believe management’s focus on capital discipline has helped streamline their strategic focus and placed greater emphasis on improving cash generation and returns. Additionally, Baker Hughes’ overwhelming market share in the gas turbine and compression business creates a long-term growth runway due to the global buildout of renewable energy projects and rising liquefied natural gas capital expenditures.”
06. Domino’s Pizza, Inc. (NYSE:DPZ)
Upside Potential: 12%
Domino’s Pizza, Inc. (NYSE:DPZ) is a multinational pizza company that operates through three segments – U.S. Stores, International Franchises, and Supply Chain. On July 24, Citi raised the price target for Domino’s Pizza, Inc. (NYSE:DPZ) to $431 per share, up from the previous target of $405. This upward adjustment in the price target suggests that Citi analysts anticipate Domino’s Pizza, Inc. (NYSE:DPZ) stock to experience further growth and have a positive outlook on the company’s performance. The new price target of $431 indicates the level at which Citi analysts believe the stock could reach in the future, reflecting their confidence in the company’s fundamentals and potential for future earnings growth. This increase in the price target could be an indicator of Citi’s belief in Domino’s Pizza, Inc. (NYSE:DPZ) ability to capitalize on opportunities, outperform its competitors, and deliver value to its investors.
LRT Capital made the following comment about Domino’s Pizza, Inc. (NYSE:DPZ) in its October investor letter:
“Domino’s Pizza, Inc. (NYSE:DPZ) is the world’s largest franchisor of pizza restaurants with over 13,800 locations in 85 countries. As for any restaurant operator, the key metric to consider for Domino’s Pizza is same-store-sales (SSS) growth. Growing same-store-sales are ultimately how a restaurant business increases earnings from its existing assets. The company continues to impress in this criterion with SSS having grown in the U.S. for 40 consecutive quarters, and an astounding 109 straight quarters internationally.
Two-thirds of the company’s stores are currently abroad, and the international segment remains the company’s largest growth opportunity, as the penetration of convenient fast food remains lower abroad than in the United States. Pizza is a product with exceptionally high gross margins, one that “translates” well across different cultures, and one that literally “travels well”, not losing much of its appeal when delivered in a cardboard box. The rise of 3rd party delivery platforms such as Uber Eats, Doordash and Grubhub is challenging the pizza category as it has expanded the number of choices consumers have for convenient takeout. However, the economics of food delivery remain challenging for most restaurants and platforms alike25, while pizza delivery continues to be highly profitable. Regardless of how the “delivery wars” currently playing out end, Domino’s financial results show little impact of this increased competition, and the company continues to deliver exceptional financial performance…” (Click here to read the full text)
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Disclosure. None. Analysts Are Increasing Price Targets of These 10 Stocks is originally published on Insider Monkey.
