Heading into an ambiguous economic environment, investors looking for as close to a sure thing may want to target analyst-backed strong buy stocks. Tracked and endorsed by the top experts on Wall Street, these securities should enjoy better-than-average returns than randomly extracted ideas.
Yes, I’ve heard just about all the criticisms you can level against the analyst community. Further, some evidence exists that artificial intelligence may one day replace your fund manager. However, I still think there’s a significant benefit in at least examining strong buy rated stocks.
For one thing, analysts had to work hard to get where they are now. It takes knowledge and years of experience to earn the trust of the Street’s top institutions. Also, these experts help cut down your research time on trending stocks by getting to the core arguments. Besides, it feels good to know that the most educated individuals are putting their reputations on the line for the enterprises they support. On that note, below are strong buy stocks to consider.
McDonald’s (MCD)
A fast-food giant and an icon of American-style capitalism, McDonald’s (NYSE:MCD) seemingly can’t do no wrong. True, millennials tend to be more health conscious than previous generations, which wouldn’t seem to bode well for MCD as one of the strong buy stocks. However, the Golden Arches continue to march forward. In the trailing one-year period, MCD gained almost 8% of equity value.
Moving forward, I believe social normalization trends may wink quite favorably on McDonald’s. Specifically, as consumer pressures increase, many folks may turn to the fast-food joint for their caffeine fix as opposed to premium coffee shops. By operating on the lower rungs of the trade-down effect, McDonald’s may justify its inclusion among strong-buy rated stocks.
As advertised, analyst consensus indeed rates MCD as a strong buy. This assessment breaks down as 20 buys, six holds and zero sells. Also, the average price target lands at $331.27, implying over 17% upside potential. Plus, you get a 2.12% dividend yield, which while not exceedingly generous helps to sweeten the deal.
Visa (V)
A cynical idea among strong buy stocks, it’s not surprising that financial services specialist Visa (NYSE:V) attracted expert voices. As multiple news agencies reported recently, Americans’ credit card debt hit over $1 trillion, a dubious record. On one level – though I’m not speaking about everyone to be clear – such a ridiculous figure confirms that many consumers can’t control themselves.
However, there’s an uglier reality that makes V one of the top trending stocks and that’s a cruel necessity. As The New York Times reported, many households hit with skyrocketing inflation have little recourse but to turn to plastic. Now, I don’t want to suggest that investors should target Visa for this reason. However, I also think it’s unavoidable that credit card providers will see increased demand.
Before you dive in, you should note that this narrative cuts both ways. If the economy really crumbles, I’m not sure if Visa would be the place to be. However, V carries a strong buy view, broken down as 19 buys and two holds. The average price target is $284.86, implying 19% growth.
Palo Alto Network (PANW)
An unsurprising inclusion among trending stocks, Palo Alto Network (NASDAQ:PANW) is a multinational cybersecurity firm. According to its corporate profile, Palo Alto’s core product is a platform that includes advanced firewalls and cloud-based services that extend said firewall coverage to other aspects of security. Since the start of the year, PANW gained over 64% of its equity value.
Fundamentally, PANW ranks among the strong buy stocks due to the enormous damage leveled by nefarious actors. Per Cybersecurity Ventures, global cybercrimes may impose a cost of $10.5 trillion by 2025. In addition, the average data breach in 2022 cost $4.35 million, a 2.6% rise from the prior year. Because our connected society presents a wide canvas of potential vulnerabilities, Palo Alto is practically permanently relevant.
Representing one of the top strong buy rated stocks, this assessment breaks down into 30 buys, two holds, and zero sell ratings. Also, the experts’ average price target stands at $277.80, implying over 22% upside potential.
On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.