CyberArk Software, MakeMyTrip, and Churchill Downs are the 3 Best Mid-Cap stocks to buy in June 2024, according to Wall Street analysts. We leveraged the TipRanks Stock Screener tool to select these three companies. Mid-cap stocks belong to those companies whose market capitalization is between $2 to $10 billion.
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These stocks have the advantages of both small and large-cap stocks. They usually have lower volatility than small caps, while having a greater potential to grow their businesses than the large-cap stocks.
Investing in mid-cap stocks can prove advantageous to your portfolio by providing diversification. In times of macro uncertainty, they fare better than the small-cap companies. In contrast, during times of economic development, mid-caps can grow their revenues and earnings faster than large-cap companies. With this background in mind, let’s dive right into the three stocks with a Strong Buy consensus rating.
#1 CyberArk Software Ltd. (NASDAQ:CYBR)
Israel-based CyberArk Software provides identity security solutions. The company’s Identity Security Platform helps enterprises secure access to any identity, be it human or machine.
Importantly, CYBR’s recent decision to acquire machine identity management provider Venafi is set to bolster its top-line growth and margins, while increasing its TAM (total addressable market) by about $10 billion to $60 billion. The growing need for cybersecurity and identity management bodes well for cybersecurity companies such as CYBR. The company will pay a total of $1.54 billion in cash and stock to acquire Venafi, with the deal expected to close in the second half of 2024, subject to approvals.
In Q1 FY24, CyberArk exceeded analysts’ expectations on both the top and bottom lines. Revenue jumped 37% while adjusted earnings per share (EPS) turned massively positive to $0.75 from a loss of $0.17 posted in the prior-year quarter.
Moreover, CyberArk raised its full-year Fiscal 2024 guidance. Total revenue is expected to grow between 23% and 25% compared to FY23. Also, adjusted EPS is projected in the range of $1.88 to $2.07, significantly higher than the FY23 figure of $1.12.
Is CyberArk a Good Stock to Buy?
Analysts are highly optimistic about CYBR stock, especially based on the expected synergies from the Venafi acquisition. On TipRanks, CYBR stock has a Strong Buy consensus rating, backed by 21 Buys and one Hold recommendation. The average CyberArk Software price target of $298.68 implies 29.9% upside potential from current levels. In the past year, CYBR shares have gained 54.1%.
#2 MakeMyTrip Ltd. (NASDAQ:MMYT)
India-based MakeMyTrip operates an online travel portal that enables customers to book airline tickets, domestic and international holiday packages, hotel reservations, and rail and bus tickets. MMYT offers its services via three brands: MakeMyTrip, Goibibo, and Redbus. The company aims to increase its footprint around the globe. Recently, MakeMyTrip entered the Gulf market, offering travel solutions on flights and hotels.
Retail investors seem to be highly bullish about MMYT shares. In the last 30 days, the number of portfolios holding MMYT stock increased by 32.5%, giving it a Very Positive Investor Sentiment signal.
For the three months ending March 31, 2024 (Q4 FY24), MMYT’s revenue and EPS outpaced the Street’s estimates by wide margins. Importantly, revenue grew 36.6% year-over-year, backed by a 21.8% rise in gross bookings. Furthermore, diluted EPS of $1.26 grew considerably from the prior-year figure of $0.05.
What is the Price Target for MMYT Stock?
Analysts are encouraged by MakeMyTrip’s growing gross bookings and profits, specifically with travel demand continuing to boom this year. On TipRanks, the average MakeMyTrip price target of $92 implies 17.9% upside potential from current levels. Also, with five unanimous Buys, MMYT stock has a Strong Buy consensus rating. Interestingly, MMYT shares have exploded 182.5% in the past year.
#3 Churchill Downs, Inc. (NASDAQ:CHDN)
Churchill Downs is an entertainment company that offers live and historical racing venues and online wagering. It also develops and operates regional casino gaming properties. Notably, CHDN pays a regular quarterly dividend of $0.382 per share, reflecting a yield of 0.29%.
The reopening of economies following the COVID-19 aftermath has bolstered the demand for Churchill Downs’ offerings. For Q1 FY24, CHDN’s revenues and adjusted EPS handily beat the consensus estimates. The company reported net revenues of $590.9 million, up 6% year-over-year, backed by solid growth in the Live and Historical Racing and TwinSpires segments.
Moreover, adjusted EPS rose 15.3% to $1.13, compared to Q1 FY23. The company repurchased $22 million worth of shares under its current share buyback plan.
What is the Price Target for Churchill Downs?
On TipRanks, the average Churchill Downs price target of $150 implies 12.8% upside potential from current levels. Furthermore, with six unanimous Buys, CHDN stock commands a Strong Buy consensus rating. In the past year, CHDN shares have remained almost flat.
Key Thoughts
The aforementioned three mid-cap stocks are highly favored by analysts and boast strong business models. Plus, all three stocks earn a Smart Score of 9 or Perfect 10, implying they are highly likely to outperform market expectations. Investors with an adequate risk-reward profile can consider investing in these mid-cap stocks after thorough research.
