At MarketBeat, we do our best to deliver information about the stocks and stories that are moving the market. But we also want to make sure we give you information about the stocks that you care about the most – because those are the ones that are most likely to be in your portfolio.
While we can’t know every stock you own, we can get some idea from the stocks you search for on MarketBeat. And this informs our content team regarding the stocks and sectors you might want to hear more about.
With that in mind, we think that this article will appeal to most of you. Here are the top 10 searched stocks by subscribers to MarketBeat All-Access. Included with each stock is a description of our outlook for the stock in the near term.
Tesla, Inc.
Sector: Auto/Tires/Trucks
Current Price: $174.88
Many investors would challenge the idea that Tesla, Inc. NASDAQ: TSLA falls into any sector other than the technology sector. However, while Tesla was priced similarly to many of the FAANG stocks, it is – at its core – a car company.
Yes, the company does make solar panels. But what is driving interest in TSLA stock is the company’s unquestioned leadership in electric vehicles (EVs). This is a sector, however, in which Tesla faces intense competition. In addition to legacy car makers such as Ford NYSE: F and General Motors NYSE: GM, the company is facing competition from pure-play EV companies such as Lucid NASDAQ: LCID and Nio (see below).
Tesla is also exposed to the same headwinds that affect many EV makers. This includes softening demand in China that may cause a production cut in December 2022. This is in addition to the possibility that elements of the Inflation Reduction Act in the United States may be modified after some objections from the European Union.
It also doesn’t help that founder and CEO Elon Musk sold 19.5 million shares of the company to help finance his purchase of Twitter. Oh, and that the company had a recall due to a software problem.
So it should be no surprise that TSLA stock is currently trading at the lower end of its 52-week range. If you believe that the EV transition is truly in its early innings, then this may be a great time to enter a position. But with the bears still firmly in control, now isn’t the time to go all in.
Amazon Inc.
Sector: Retail/Wholesale
Current Price: $88.19
Although Amazon Inc. NASDAQ: AMZN is one of the FAANG stocks, the company is one of the most closely watched retail stocks. And this year long-time investors are not used to the stock’s performance. In the last 12 months, AMZN stock is down over 50%. And a good bit of that loss came after the company’s earnings report in October.
At that time, Amazon missed on both the top and bottom lines. It also issued pessimistic guidance that shows – at the very least – that consumers are shifting away from buying things to spending on experiences. Perhaps as a way of changing the narrative, the company just reported over $1 billion in sales on the Thanksgiving holiday shopping weekend.
What that means long-term is anybody’s guess, but Amazon is more than a retail behemoth. That’s why investors should still pay attention to the company’s high-margin Amazon Web Services unit, the fastest-growing part of the company’s business. This is a sector that brings together areas like 5G, the Internet of Things (IoT), and cloud computing. It’s also where the company continues to generate significant ad revenue.
AMZN stock is trading near the bottom of its 52-week range, and with no news coming in until the next earnings report, it could still drift lower. But with AWS likely to give the company’s revenue and earnings a solid floor, it may be fair to say that the bottom is in.
Apple Inc.
Sector: Computer and Technology
Current Price: $142.17
Apple Inc. NASDAQ: AAPL is the next stock on our list. You may be picking up a theme. MarketBeat All-Access members are interested in several of the mega-cap companies that headline the financial news every day.
Of course, Apple is most commonly identified with its iconic iPhone. The release of the latest version and, more importantly, the sales figures for those phones is headline news that moves markets. In fact, that’s one of the reasons that AAPL stock has been range-bound for much of 2022. The launch of the iPhone 14 is corresponding to a slowdown in discretionary consumer spending.
There is also concern about the company’s supply chain which is closely tied to China. However, the company is making moves to address that. And while it will take years to fully execute those plans, it points out to investors that Apple isn’t sitting idly by.
But there’s a reason that it is said that as Apple goes so goes the market. That’s because Apple continues to generate a significant amount of revenue from its Services division. Plus Apple TV+, is beginning to entrench itself into the streaming market. To that end, it is one of the leading candidates to take over the NFL Sunday Ticket when the league’s contract with DirecTV ends after this season.
Nvidia Corporation
Sector: Computer and Technology
Current Price: $158.24
The semiconductor sector is notoriously cyclical. When demand is on the rise, investors are richly rewarded. But when it demand slows, the drop can be significant. To illustrate this, Nvidia Corporation NASDAQ: NVDA stock is down just over 50% in the last 12 months. This came after a 540% rise in the 18 months that began with the onset of the Covid-19 pandemic.
Much of that is due to an inventory glut, particularly as it related to the company’s gaming business. The company believes it will have its inventory right-sized by the first quarter of its 2024 fiscal year which will end in April of next year.
But the larger narrative for Nvidia has to do with the demand for semiconductors themselves which is only going to increase in the coming years. From the buildout of 5G to data center growth and electric vehicle demand to the continued growth of artificial intelligence, there is a long avenue for growth. And Nvidia will be meeting this demand with its next generation of GPU-driven products.
Some investors may want to wait until there’s a clear indication that the company is turning around the downtrend in revenue and earnings. However, there are those that would argue that if you wait for that to happen, you’ll have missed the rally.
In fact, there’s evidence that the rally has already started. In the month ending December 6, 2022, NVDA stock is up 11%. And since hitting its 52-week low in October, the stock is up 47%. If investors need more bullish sentiment, analysts tracked by MarketBeat give the stock a price target of over $211 which is a 32% upside from its current level.
Microsoft Corporation
Sector: Computer and Technology
Current Price: $244.06
Microsoft Corporation NASDAQ: MSFT has not been spared from the sell-off in the tech sector. However, as of this writing, MSFT stock is “only” down 27% which means it’s faring better than many of its sector counterparts.
The company is making headlines for its proposed acquisition of Activision Blizzard NASDAQ: ATVI. As Sam Quirke wrote this move “will cement its (Microsoft’s) position in one of the hottest markets out there.” One of the reasons for that will be its recent announcement that it will continue to make the Call of Duty title available on Nintendo for 10 years should the acquisition of Activision Blizzard go through. This is being done to fend off antitrust arguments from Sony which opposes the acquisition.
Microsoft plans to continue spending in its various businesses in an effort to grow its market share. Doing so at a time when monetary policy is tightening will impact earnings in the short term. And for investors, it may mean that the bottom isn’t quite in for MSFT stock. But with both revenue and earnings continuing to grow on a year-over-year basis, Microsoft is starting to look like a bargain at these levels.
Plus, Microsoft is one of only a handful of tech stocks that pays a dividend. While the yield of just over 1% isn’t that exciting, the company has been increasing the dividend in each of the last 19 years.
Zim Integrated Shipping Services Ltd.
Sector: Transportation
Current Price: $18.35
The message for investors considering buying Zim Integrated Shipping Services Ltd NYSE: ZIM stock is simple. Buy for the dividend, hold for the growth. As Thomas Hughes wrote, analysts continue to give ZIM stock a hold rating because it continues to pay a high dividend.
However, the goodwill of analysts will only go so far. At some point, investors will need to see evidence that the slowdown in container shipping will reverse. For that to happen, China will have to loosen many of its Covid-19 restrictions to allow the free flow of container traffic.
But even if that happens, forecasts for a global recession among corporate CEOs is growing. And there is some evidence that rising interest rates are beginning to have some effect on global consumer demand.
At the same time, many analysts are suggesting that sometime next year, the Fed will be pausing and/or pivoting from its current strategy. That would be bullish for ZIM stock. But that brings to mind another sentiment that is popular around the holiday season, “if ifs and buts were candy and nuts…” – the takeaway is that ZIM stock does look like a hold.
Advanced Micro Devices, Inc.
Sector: Computer and Technology
Current Price: $70.62
Advanced Micro Devices, Inc. NASDAQ: AMD is another semiconductor stock that is trading more than 50% lower in the last 12 months. Like Nvidia, the company is making progress at getting its inventory right-sized and managing the expectations of investors.
There was a time before, and during, the pandemic when AMD couldn’t set the bar high enough. Heading into 2023, the company’s challenge is to ensure they manage the expectations of investors. That shouldn’t be too hard to do. The company dominates the console gaming market and that’s a key reason why AMD showed year-over-year (YOY) gains in the gaming sector while Nvidia showed a YOY decline of over 30%.
As long as AMD continues to gain market share on both the CPU and GPU sides of the business, investors shouldn’t have concerns about revenue or earnings. But the company can’t control the broader macroeconomic picture which could continue to weigh on AMD stock in the short term.
Nio Inc.
Sector: Auto/Tires/Trucks
Current Price: $12.60
Nio Inc. NYSE: NIO is one of Tesla’s rivals in the Chinese market and there’s a lot to like about the company’s potential growth. But that hasn’t stopped NIO stock from dropping more than 60% in the last 12 months.
A drop like that should give you pause if you don’t already own NIO stock. But is this a buy-the-dip opportunity? Nio is continuing to deliver vehicles in spite of the Covid-19 restrictions in China. And it has worked around one of the most contentious issues surrounding electric vehicles – the battery – with its Battery-as-a-Service (BaaS) program. Nio is also taking steps to expand into Europe.
With all that in the plus column, Nio faces the same problem that is befalling all Chinese stocks and companies for which China is a significant part of its supply chain. That is, when will the country be fully open for business? That’s a difficult question to answer and until it is, NIO stock looks like one for the watchlist and nothing more.
Meta Platforms, Inc.
Sector: Computer and Technology
Current Price: $114.20
Meta Platforms, Inc. NASDAQ: META is down 64% in the last 12 months. However, it seems many investors are wondering when it will be safe to jump back into the “deFAANGed” stock. This is a question of when META stock may be oversold, but investors may still have a while to wait. Both statements can be true.
The company is seeing lower ad revenue largely because companies like Apple are allowing iPhone consumers to not allow tracking on certain apps, including Facebook and Instagram. This is putting weeds into the “walled garden” approach towards advertising that has served Meta Platforms well for years. But with privacy concerns bubbling to the service of all things technology, Meta has no immediate plan to offset this revenue other than cost cutting.
Plus, the company’s pivot to the metaverse is proving to be an expensive proposition. In the last quarter, the company’s metaverse division contributed $2.3 billion to the top line. But its loss from operations was a staggering $12.7 billion.
Meta Platforms has to show a path to growth that involves playing offense instead of playing defense. Perhaps that will be the metaverse. But until they can, there’s not much to get excited about in the real world.
Exxon Mobil Corporation
Sector: Oil/Energy
Current Price: $103.24
Exxon Mobil Corporation NYSE: XOM is one of the only stocks on this list trading near the top of its 52-week range. Not surprisingly, it’s part of the energy sector which has been one of the few bright spots for investors in 2022.
Of course, markets don’t move in one direction and many investors are wondering if they’ve missed their opportunity. That doesn’t appear to be the case. Oil prices are down as we close out the year. But the IEA is forecasting that global demand for crude oil will come in at 101.3 million barrels per day in 2023. That’s a slight increase from 2022. And keep in mind that the strategic petroleum reserve will need to be refilled which will, at the very least, put a floor on crude prices.
There continues to be hand-wringing about the windfall profits that Exxon Mobil has been reaping. However, that misses the point that companies such as Exxon Mobil are significant players in the renewable energy market. In the case of XOM, the company is making significant investments in renewable diesel.
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