One shouldn’t keep a myopic view of the market while building a strong and sustainable portfolio. Gains and losses are averaged out over a longer period, giving the investor the benefit of compounding wealth. Thus, keeping the long-term in mind, I picked three “Strong Buy” companies selected by using TipRanks’ Trending Stocks tool, which tracks the most rated stocks: Cytokinetics (NASDAQ:CYTK), Costco (NASDAQ:COST), and Workday (NASDAQ:WDAY). These stocks have been grabbing attention this week.
Cytokinetics
Investors have their hopes pinned on leading biopharmaceutical company Cytokinetics’ overall pipeline of drugs for various cardiac conditions. Despite the FDA’s thumbs down for its omecamtiv mecarbil drug earlier this month, investors were unperturbed, and the stock is up more than 11% this month.
Recently, Needham analyst Serge Belanger added Cytokinetics to his “Conviction List” and selected it as his “Top Pick” for 2023. Despite the disapproval of its omecamtiv drug, the analyst thinks that investors will be more interested in data readouts from various trial phases of Cytokinetics’ aficamten medication next year.
Is CYTK a Buy?
Cytokinetics holds the Street’s Strong Buy consensus rating based on 10 Buys and one Hold. The average CYTK stock price target of $63.18 implies an upside potential of 38.58%.
Costco
Costco’s unique business offers bulk merchandise at discounted prices via membership warehouses. Planned investments and a customer-centric approach to business have helped the business survive the tough year of 2022.
Recently, Tigress Financial Partners analyst Ivan Feinseth noted that consumer spending is likely to improve later in 2023, and that will be a boon for Costco’s revenue growth. The analyst also believes that Costco’s leadership position in the warehouse-based retail market gives it the strength to manage its supply chain movements.
Despite cutting the price target to $635 from $678, Feinseth reiterated his Buy rating on COST stock. The analyst thinks that the recent pullback is a “major buying opportunity” and expects Costco’s growth to continue to be driven by its loyal customer base and resilient business model.
Is Costco a Buy, Sell or Hold?
Costco is a Strong Buy on Wall Street, based on 18 Buys and five Holds. The average price target of $557.14 indicates an upside of 20.4% over the next 12 months.
Workday
Cloud applications provider Workday is experiencing solid demand for its Human Capital Management (HCM) and financial management solutions. The company’s cloud-based business model and growing product portfolio have helped it maintain its footing throughout the turbulent year. It even expects to continue seeing healthy order momentum in Fiscal 2023, despite challenges.
Despite falling more than 37% this year so far, the stock has a solid growth runway ahead based on the prospects in the cloud applications market, especially in the HCM market. Notably, Market Research Future forecasts the global human capital management software market to reach $28.93 billion by 2030, witnessing a CAGR of 8.2% between 2020 and 2030.
Recently, Jefferies analyst Brent Thill reiterated a Buy rating on the stock and raised the price target to $235 from $225. The analyst believes that the appointment of Carl Eschenbach as co-CEO can be very beneficial to the existing leadership team and open several new opportunities for the company.
Is Workday Stock a Buy?
Wall Street is bullish on WDAY stock, with a Strong Buy consensus rating based on 19 Buys and five Holds. The average price target stands at $203.27, which means that the current price can go up more than 23% over the next 12 months.
Bottom Line
The three stocks mentioned above, each of which has its own unique strengths, could protect your portfolio in the event of a downcycle. As we approach 2023 while still riding the bear market, investors are increasingly interested in buying recession-resistant stocks, such as SYTK, COST and WDAY.
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