Are These The Best Stocks To Buy Right Now?
This year, the stock market has surprised many investors by being able to rebound so quickly. It’s easy to forget that the market has recovered all its losses during the coronavirus pandemic. With the S&P 500 and Nasdaq near all-time highs, blue-chip stocks like Amazon (AMZN Stock Report) and Apple (AAPL Stock Report) helped lead the rally. That said, with these tech stocks also reaching new highs, it’s not surprising that any slightly disappointing economic data would send the stock market crashing down.
The stock market continued to extend its weaknesses as investors’ hope for another fiscal stimulus before the election fades. The disappointing unemployment data also added fuel to the fire. New unemployment insurance claims rose against expectations last week. The figures reached the highest level since mid-August, suggesting that the labor market recovery has not been as speedy as many hoped.
There Are Great Bargains In The Stock Market Today
If you have been trading long enough in the stock market, you would most probably come across the three-day rule. It becomes conventional wisdom that in any news-driven market crisis, investors would wait until the third business day to trade anything. We saw tech rebound after a massive sell-off in September. Can we expect to see the same today?
Even if we couldn’t see a rebound today, that doesn’t mean it’s bad news. In fact, investors could take this opportunity to buy stocks that previously were at a high level. For instance, investors who missed out on top cloud stocks like Fastly (FSLY Stock Report) could take another chance on this stock after FSLY stock plunged 30% on Thursday. The drop came after lackluster preliminary results, but some analysts are still saying ‘Buy’. If you believe that this is a one-off setback, this may be an opportunity to buy on the dip.
Investors seem to be in a defensive mode when there are so many uncertainties in the market, and that’s understandable. However, if you believe in the potential and the value it would be able to bring, you wouldn’t mind paying a dollar more or less today. With all that being said, do you have these stocks that could continue to defy gravity?
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Best Stocks To Buy [Or Avoid] Right Now: Nio Inc.
Shares of Nio (NIO Stock Report) surged again on Thursday when the broader market was in a sea of red. This came after Citigroup analyst Jeff Chung turned bullish on the ‘Tesla of China’. He cited a ‘very strong’ order backlog, increased market share, lower battery costs, and policy tailwind related to exports. The analyst raised his price target to $33.20, implying an 18% potential upside. Obviously, most attention has been on Tesla (TSLA Stock Report) among EV stocks enthusiasts. But the truth is, NIO stock price was the biggest winner among top EV stocks. As of October 15, Nio had risen 654% this year, way higher than Tesla’s 421%.
Nio’s quarterly and monthly sales are setting records. According to CleanTechnica, Nio delivered 4,708 vehicles in September, up 133% year over year. In the third quarter, its deliveries increased 154% to 12,206. Its deliveries in the first nine months of 2020 have more than doubled to 26,375.
Nio distinguishes itself from competitors with its BaaS (Battery as a Service), which allows users to swap batteries in minutes. This saves time in comparison with charging batteries. In fact, it may be well-suited to high-density cities in China. Now, with such a positive projection of Nio’s growth in the long run, should investors keep a close eye on NIO stock and pounce on it when it dips?
Best Stocks To Buy [Or Avoid] Right Now: Cloudflare
Cloudflare (NET Stock Report) has also been exhibiting some bullish signs after the stock suffered some beating during the September sell-off. Apart from a temporary dip in the stock price yesterday, NET stock has held up relatively well in the past 5 trading sessions after the announcement of Cloudflare One. The network-as-a-service platform promises to secure and connect companies and remote working teams anywhere and on any device.
“The only way to secure today’s work-from-anywhere economy is to secure each individual employee, protecting their individual networks, devices, and access to business-critical applications. With Cloudflare One, we’re giving organizations of any size the power to solve their security and networking needs seamlessly, no matter how their business needs shift.”- Matthew Prince, co-founder and CEO of Cloudflare
Cloudflare One notably integrates with major providers of identity management and device-security solutions. Some of the notable providers in the new product’s partnership ecosystem include Okta, Alphabet’s Google Workspace, Facebook, VMWare’s Carbon Black, and more. With so much growth prospects centering around Cloudflare, is NET stock a long term buy?
[Read More] Top Growth Stocks To Hold Over The Next Decade? 3 Names To Watch
Best Stocks To Buy [Or Avoid] Right Now: Stitch Fix
Online apparel retailer Stitch Fix (SFIX Stock Report) has continued to gobble up market share at the expense of rivals. The company recorded a larger-than-expected loss in its fiscal fourth-quarter results on September 22. Nevertheless, investors remain optimistic about the company’s growth in active users and the increasing adoption of its direct buy service. Direct buy offers a lower entry barrier for consumers who want to experience the company’s personalized shopping experience, without committing to a subscription. You could argue that there’s no online clothing company today that holds more promise than Stitch Fix. The company’s focus on recommendation algorithms is a unique strength, with some calling it the Netflix (NFLX Stock Report) of clothing.
“As traditional retailers close their doors, consumers are shifting to Stitch Fix as evidenced by our increased demand and growth, validating that we’re taking share,” said President Elizabeth Spaulding during the earnings conference call.
Even with the advantage of e-commerce, the pandemic has been a speed bump for this company. It expects at least two more quarters of challenges due to the pandemic. As such, investors will need to have some patience before the company can realize its full potential. While last quarter’s revenue growth of 11% year-over-year may have disappointed some, the silver lining is that in July, the company saw first Fix shipments to new clients rose 50% from a year ago. On that note, is SFIX stock a buy before its next quarter’s earnings?
