In the ever-shifting landscape of the stock market, separating the wheat from the chaff is no easy feat. It’s a world where the wrong picks can erode your hard-earned gains, but the right ones? They have the power to catapult your portfolio to new heights. With thousands of stocks in the fray, pinpointing those poised for a breakthrough can feel like searching for a needle in a haystack.
This is where we step in. Every week, we comb through the market’s labyrinth, scrutinizing trends, earnings reports, and industry shifts. Our goal? To distill this vast universe of stocks down to a select few – those unique opportunities that are primed for significant movement in the near future.
This week, we’ve zeroed in on three standout stocks. These aren’t your run-of-the-mill picks; they are the culmination of rigorous analysis and strategic foresight. We’re talking about stocks that not only show promise in the immediate term but also hold the potential for sustained growth.
Corebridge Financial (NYSE: CRBG) A Low-Profile Insurance Stock with Strong Buyback Potential
Corebridge Financial, a recently spun-off entity from AIG, is a solid stock to consider for its significant buyback potential and undervalued position. Despite its relative anonymity, Corebridge operates as a $15 billion retirement services and life insurance company, trading at approximately $28 per share. What’s catching our attention here is the company’s strong fundamentals and the ability to grow its book value significantly—up to $50 per share by 2025, according to our estimates, which would place it at four to five times earnings.
One of the most compelling reasons to consider Corebridge is its aggressive share buyback strategy. The company has the potential to repurchase 20% of its stock per year, which could help lift the share price even without widespread investor recognition. This approach allows the company to take matters into its own hands, reducing the float and boosting shareholder value over time. It’s not a name you’re seeing splashed across headlines, but that’s exactly what makes it intriguing—this is an under-the-radar stock with strong fundamentals and a solid plan to return value to investors.
If you’re looking for a value play outside the dominant tech sector, Corebridge offers a rare opportunity to get in on a stock that doesn’t need to rely on outside hype to grow its price.
ASML Holding (NASDAQ: ASML) Tech Giant with Strong Upside Potential
ASML, a leader in high-tech machinery for chip manufacturing, is a standout stock that’s currently “on sale.” The stock is down roughly 20% to 25% from its highs, presenting a buying opportunity in a company that sits at the heart of the global tech trade. ASML’s advanced lithography machines are critical for the world’s top chipmakers, making it a key player in the ongoing semiconductor boom driven by AI and advanced computing.
Year-to-date, ASML’s shares are up about 5.1%, but analysts see much more room to run. The stock has a consensus price target of 1,057.52 euros ($1,170), suggesting a potential upside of 46.2% from current levels. Out of 38 analysts covering ASML, 29 have a buy or overweight rating, highlighting strong market confidence in the company’s growth prospects.
With its cutting-edge technology and strategic position in the semiconductor industry, ASML is well-poised to benefit as AI continues to transform businesses worldwide. The current dip offers a great entry point for investors looking to gain exposure to a tech stock that’s essential to the future of chip manufacturing. If you’re looking for a tech name that combines innovation with a significant upside, ASML is one to keep on your radar.
DraftKings (NASDAQ: DKNG) Sports Betting Leader with Big Growth Potential
DraftKings is one of those stocks that many investors might be underestimating right now, especially given the current market environment. Despite the Federal Reserve’s recent rate cut signaling economic uncertainty, there are compelling reasons to consider adding DraftKings to your portfolio. Here’s why this online sports betting company is worth a closer look.
DraftKings’ stock is still trading well below its peak, down 46% from its 2021 highs and currently 16% off its 52-week high set in March. This pullback presents a unique entry point, especially considering that analysts are still optimistic. The average 12-month price target is $49.62, suggesting a potential upside of nearly 25% from current levels.
DraftKings isn’t just about sports betting anymore. The company has expanded into online casino games, offering another revenue stream that complements its sportsbook business. This move opens up a second profit center, providing a broader base for growth. The online casino market itself has been gaining traction, with revenues up 32.5% year-over-year as of July. Despite only being live in seven states, the online casino segment is already making a dent in traditional brick-and-mortar gambling, which could drive even more growth as more states consider legalization.
Growth prospects for DraftKings remain robust. Last quarter, revenue surged 26% year-over-year, and the company raised its full-year guidance, expecting revenue growth of 38% to 43% in 2024. DraftKings also anticipates EBITDA of between $340 million and $420 million this year, with a target of up to $1 billion next year. As DraftKings continues to establish itself in new markets, profitability tends to improve as marketing costs decrease and customer loyalty builds.
Looking ahead, the broader industry outlook is also promising. Goldman Sachs estimates that the U.S. sports betting market could grow from $10 billion today to $45 billion at its peak, while the online casino market in the U.S. is expected to grow to $13.7 billion by 2027, surpassing the U.K. as the world’s largest.
While DraftKings may not be a core holding for every portfolio due to its relative newness and volatility, it presents a strong growth opportunity for those looking to add some upside potential. With expanding markets, multiple revenue streams, and a stock that’s still trading at a discount, DraftKings is well worth considering.
