Wall Street analysts are spotting attractive stocks with strong long-term growth prospects that are trading at compelling levels. Three stocks favored by top analysts are Microsoft, Snowflake, and Netflix. Microsoft is considered one of the key beneficiaries of the ongoing artificial intelligence wave.
Jefferies analyst Brent Thill sees multiple drivers for the stock to reboot, including growth in Azure and M365 Commercial Cloud as AI revenue becomes more significant. Thill noted that “Microsoft’s margin in the mid-40s is still well above large cap peers in the mid-30s.”
Snowflake delivered positive fourth-quarter results for fiscal 2025 and issued a solid full-year outlook, driven by AI-related demand. RBC Capital analyst Matthew Hedberg views Snowflake stock as an attractive pick due to its superior management team, a $342 billion market opportunity by 2028, and its strong architecture.
“With 30% growth at a $3.5B scale, multiple idiosyncratic revenue drivers, and margin improvement, Snowflake remains one of our top ideas,” said Hedberg. Netflix continues to impress investors with its upbeat financial performance and strategic initiatives. JPMorgan analyst Doug Anmuth thinks that “Netflix should prove relatively defensive against macro headwinds,” given the robust engagement and affordability of the platform.
Anmuth expects Netflix’s revenue growth to be bolstered by organic subscriber additions and a rise in average revenue per member due to recent price hikes. The Dow Jones Industrial Average has tumbled more than 2% in the first quarter, but analysts are more optimistic about certain stocks heading into the second quarter.
Analysts favor tech companies
Nvidia, Microsoft, and Disney are among the Dow stocks that analysts are feeling most bullish about. Despite Nvidia’s sharp sell-off at the start of the year, nearly 80% of analysts covering the stock rate it a buy, and the average price target implies shares gaining about 53% from their current levels. Bank of America said the recent pullback presents a prime buying point for those looking to gain exposure to the artificial intelligence giant.
More than half the analysts who watch Disney rate it a buy and see shares advancing about 26% from current levels. Bank of America reiterated its conviction in the stock, saying that despite risks from macro uncertainty, Disney’s fundamentals appear intact. Three stocks are flashing buy signals from Wall Street analysts, suggesting upside potential in the second quarter: Costco, American Airlines, and MicroStrategy.
Analysts view Costco’s recent price decline as a strategic entry point for investors. The prevailing sentiment among analysts is a Moderate Buy, with a consensus price target representing a potential upside of nearly 15%. American Airlines has faced significant headwinds in recent years, but recent analyst ratings upgrades suggest a potential shift in trajectory.
The consensus rating for AAL is now a Moderate Buy, with an average price target implying an upside potential of over 70%. MicroStrategy’s stock price is highly correlated with the performance of Bitcoin. Despite recent volatility, Wall Street analysts are overwhelmingly bullish on MicroStrategy, with a consensus rating of Buy and an average price target translating to a potential upside of nearly 80%.
