Wall Street is once again on a roller coaster ride as investors try to navigate the path between high inflation and the Fed’s aggressive rate hikes. What we do know for sure is that the S&P 500 is down 18% year-to-date and the NASDAQ is down 26%.
However, at least one investment expert is putting himself in his soapbox to encourage investors to buy now while prices are low. That’s the view of shark tank investor Kevin O’Leary. The venture capitalist advocates that investors use volatility to start a buying streak.
“If you’re an investor, perhaps the best thing to do here — since you can’t guess the bottom — is to take opportunities like today’s and buy stocks that you think are attractive,” O’Leary noted.
With this in mind, Wall Street analysts have identified two compelling tickers whose current low share prices don’t reflect their long-term value. The analysts note that everyone will be trending back up and see an attractive entry point. Using TipRanks’ database, we found that the analyst consensus rated both as “Strong Buy” with significant upside potential as well. Let’s take a closer look.
Couchbase, Inc. (BASE)
The first stock stands out in the world of database management. Couchbase produces and distributes a range of open-source database-as-a-service (DBaaS) platforms, providing users with a distributed architecture that enables elastic scaling, workload isolation, and real-time data replication while addressing point-to-point security concerns avoids failure. The system is designed for use on mobile and IoT devices that use intermittent connections or rely on microservers or consumption-based cloud computing.
It’s all a fancy way of saying that Couchbase’s products – Capella, the Couchbase Server, Couchbase Mobile, and the Autonomous Operator – go where your work is.
Couchbase went public on the NASDAQ in July last year, raising $200 million in its IPO. Shares have since fallen about half, even as the company’s revenue has steadily increased and its bottom-line net losses have moderated.
In its most recent earnings report for the second quarter of fiscal 2023 — the quarter ending July 31 — Couchbase reported year-over-year revenue growth of 34%, with revenue hitting $39.8 million. Total revenue included a 32% year-over-year increase in subscription revenue, which was reported at $37.1 million. Annual recurring revenue (ARR), a key metric for future business, reached $145.2 million, up 26% year over year. The company’s earnings came in at a loss of 19 cents per share on non-GAAP measures. This was a dramatic improvement from the $1.54 per share loss recorded in the year-ago quarter.
Covering this stock for Oppenheimer is 5-star analyst Ittai Kidron, who writes, “Couchbase easily exceeded F2Q expectations and once again saw positive demand trends for Capella. It also appears relatively resilient to macro demand headwinds, given its historical focus on large companies and multi-year deals. While vigilant for potential recessionary pressures, we remain bullish on the large NoSQL opportunity and market expansion with DBaaS/Capella LT.”
Kidron follows up his comment with an Outperform rating (ie Buy) and a price target of $22, implying ~44% 1-year upside potential. (To see Kidron’s track record, click here)
Overall, the Consensus Strong Buy rating for this stock is based on 5 recent analyst ratings, including 4 for “buy” and 1 for “hold”. The average price target of $22 is practically the same as Kidron’s. (See Couchbase Stock Prediction on TipRanks)
Helios Technologies (HLIO)
Next is Helios Technologies, a player in the global industrial technology sector. Helios is a leading hydraulics and electronics supplier that develops, designs, manufactures and markets a wide range of products and hard-tech solutions. The Company’s products include, but are not limited to, custom electronic control systems, hydraulic cartridge valves and quick release valves, all for a variety of end use markets. Helios has sales and customers in more than 90 countries around the world.
Helios is working toward the 10-year goal set in 2015 of $1 billion in annual sales. The company boasts that it achieved this goal ahead of schedule in 2023. In the last full calendar year of 2021, Helios had net sales in excess of $869; The company had sales of $482 million in H1 2022 and is on track to exceed last year’s total sales. Its most recent quarter, 2Q22, reported revenue of $241.7 million, up 8% year over year. Earnings for 2Q22 were $1.18 per diluted share on non-GAAP measures. This was flat since Q1 and down 2% yoy.
However, Helios has faced headwinds over the past 12 months including supply disruptions, pricing/cost pressures and de-stocking. As a result, the stock is down 51% year-to-date.
However, Stifel’s 5-Star Analyst Nathan Jones remains bullish on the stock, pointing to several factors that should point a way forward.
“We continue to see multiple opportunities for Helios over the next several years under the Company’s control: The acquisition completed in recent years provides Helios with an opportunity to transform from a holding company into an integrated operating company, gaining capacity, reducing costs, Shorten supply chains and increase market penetration worldwide…. Successfully leveraging the companies to simultaneously drive above-market growth while reducing the cost structure,” explained Jones.
Building on this stance, Jones has a Buy rating on HLIO stocks and a price target of $74. This number suggests a potential of ~44% in the coming year. (To see Jones’ track record, click here)
All in all, all three of the most recent analyst ratings here are positive, giving Helios stock a unanimous consensus Strong Buy rating. HLIO is currently at $51.52 and its average price target of $80 implies a 12-month upside of 55%. (See HLIO Stock Prediction on TipRanks)
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Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is for informational purposes only. It is very important that you do your own analysis before making any investment.