Top Wall Street Analysts Favor These Stocks for Growth

The headquarters of Nvidia is located in Santa Clara, California.

Excitement around artificial intelligence has propelled the S&P 500 upward in 2024, benefiting key chip stocks and energy players in utilities.

For investors aiming for solid returns, identifying companies with long-term growth potential is crucial.

Top Wall Street analysts, armed with their expertise, can shed light on the key factors that might drive a company's long-term growth and help pinpoint stocks likely to yield substantial profits.

Here, we explore three stocks highlighted by leading analysts in the field.

Fortinet

The first recommendation is cybersecurity firm Fortinet (FTNT). The company seeks to establish itself as a leader in the secure access service edge sector, utilizing machine learning and AI technologies to provide cybersecurity solutions.

Recently, analyst Shaul Eyal from TD Cowen reaffirmed a buy rating on Fortinet, increasing the price target from $75 to $90. Eyal's analysis, based on channel checks and discussions with industry players, indicates a steady recovery in Fortinet's business and strong demand for its diverse product range.

Channel checks also suggest that Fortinet's third-quarter revenues and billings may hit the upper range of its forecast, with a chance for slight upside. Eyal is optimistic about the company's expected revenue growth of 12% for Q4, pointing to robust closure rates and bolstering demand as it enters a historically strong season.

A significant factor in Fortinet's recovery is its expanding operational technology product line and a long-term replacement cycle set to phase out outdated systems. Furthermore, the company's increased focus on AI-driven networks and cloud security, following its recent acquisition of Lacework, will likely contribute to its growth.

Eyal ranks as the 12th best analyst out of over 9,100 tracked by TipRanks, with a profitable rating rate of 71%, delivering a notable average return of 27.3%.

GitLab

Next is GitLab (GTLB), an AI-centric cloud software enterprise that enhances developer efficiency, boosts operational performance, and minimizes security and compliance challenges.

After meeting with GitLab's management, Mizuho analyst Gregg Moskowitz maintained a buy rating for the stock, setting a price target of $62. He highlighted management's confidence in tapping into a $40 billion addressable market, noting that both GitLab and Microsoft's GitHub currently share about 5% of market share in the software development lifecycle sector.

Management anticipates that its Duo Pro product will accelerate in popularity by 2025, powered by the surge in generative AI. Moskowitz also pointed out growing interest for the GitLab Dedicated offering, which is expected to drive higher average revenue per unit.

Moskowitz is positive about GTLB's prospects for high-level execution and growth in the medium to long term. He identifies several growth levers including seat expansion and price increases that will drive further growth.

Moskowitz ranks 321 among more than 9,100 analysts on TipRanks, with a success rate of 58% and an average return of 12.6%.

Nvidia

Lastly, we turn to semiconductor leader Nvidia (NVDA), which has experienced impressive revenue growth fueled by soaring demand for its advanced GPUs (graphics processing units) essential in creating AI models and applications.

Following a meeting with Nvidia’s management, Goldman Sachs analyst Toshiya Hari reiterated a buy rating for NVDA, raising the price target from $135 to $150. His enthusiasm stems from a renewed understanding of Nvidia's competitive advantage and the anticipated rise in inference workload complexity, which will likely increase future computing demands.

Hari emphasized Nvidia's confidence about ongoing demand as data center operators continue to invest in accelerated computing and GPUs, especially amid the AI boom. Expected growth from Nvidia's Blackwell platform is not just seen as a boost for short- to mid-term revenues but as a vital factor that strengthens Nvidia’s market position.

The analyst adjusted his revenue projections for fiscal years 2025 to 2027 to align with current industry trends, including rising cloud investment and encouraging order patterns at major AI server suppliers like Dell and Hewlett Packard Enterprise.

Hari ranks 32nd among more than 9,100 analysts followed by TipRanks, achieving a successful rating rate of 68% and an average return of 27.5%.

stocks, growth, investment