Although the most followed indices witnessed a comeback last week, the stock market is preparing to close the worst first half of a year in decades. While the Dow Jones Industrial Average rose 5.4% last week, the S&P 500 and tech-heavy Nasdaq Composite gained 6.5% and 7.5%, respectively.
Many strategists expect quality stocks that have bottomed out to make the most of occasional bounces. Additionally, as portfolio managers rebalance their portfolios at the end of the second quarter, shares could rise 7% this week, according to JPMorgan Chase analyst Marko Kolanovic. In addition, Bank of America Corp. (bac) analysts expect the next bull market to see the S&P 500 trading at 8,900 for February 2028.
Amid this backdrop, Wall Street analysts expect Remitly Global, Inc. (TRUST), Oportun Financial Corporation (OPRT), and LendingTree, Inc. (TREE) to double in the coming months. Therefore, these stocks could be solid additions to one’s watch list.
Remitly Global, Inc. (TRUST)
RELY is a provider of digital financial services for immigrants and their families. The company offers cross-border remittances in several countries.
For the first fiscal quarter ended March 31, RELY’s revenue increased 49.4% year over year to $136.01 million. Net cash provided by financing activities reached $2.60 million, a substantial increase from its negative value in the prior year. Cash, cash equivalents and restricted cash the balance improved 86% over the same period last year to $444.66 million.
The EPS consensus estimate for the quarter ending September 2022 indicates a 78% year-over-year increase. Also, the consensus revenue estimate for the same quarter of $157.90 million reflects a 45.2% improvement over the prior year period.
The stock has gained 3.7% over the last five days and 0.9% intraday to close its last trading session at $9.23.
All four Wall Street analysts who rated RELY rated it Buy. The 12-month median target price of $18.75 indicates a 103.1% growth potential. Price targets range from a low of $14.00 to a high of $23.00.
Opportun Financial Corporation (OPRT)
OPRT operates as a provider of financial services. The company’s offerings include personal, auto and credit loans, serving customers online and by phone, as well as retail customers.
On May 24, the OPRT announced the issuance of $400 million in two-year asset-backed revolving notes, which are secured by a pool of secured and unsecured term loans. “This transaction demonstrates that we can access growth capital even in challenging markets and demonstrates investor confidence in our AI-powered underwriting,” said Jonathan Coblentz, OPRT’s CFO and Managing Director.
On April 4, the company announced the sale of $228 million of loans through the issuance of repayable asset-backed notes. This transaction is expected to allow the company to sell its loans at an attractive price and generate capital.
OPRT’s total revenue increased 58.7% year over year to $214.70 million in the fiscal first quarter ending March 31. Adjusted net income increased 332% from the prior year quarter to $52.70 million. Adjusted EPS improved 285.4% from the prior year period to $1.58.
The FY2023 Street EPS estimate of $2.78 reflects a 10.8% increase from the prior year. Similarly, Street’s revenue estimate for the same year of $1.1 billion indicates a 24.6% year-over-year improvement. Additionally, OPRT has an impressive track record of earnings surprises, having beaten consensus EPS estimates in each of the last four quarters.
OPRT shares have declined 2.8% intraday to close their last trading session at $8.25.
All five analysts who rated OPRT rated it Buy. The 12-month median target price of $25.20 indicates a 205.5% upside potential. Price targets range from a low of $15.00 to a high of $30.00.
LendingTree, Inc. (TREE)
Through its subsidiary LT Intermediate Company, LLC, TREE operates as a consumer platform, offering purchase mortgages, credit cards and information. The company operates through the three broad segments of Home; Consumer; and Insurance.
On June 23, the company provided its guidance for the second quarter. TREE estimates his income to be between $259 and $264 million. Adjusted EBITDA is expected to be between $26 million and $29 million. The company also reported that it remains focused on its strategic initiatives.
For the fiscal first quarter ended March 31, TREE revenue increased 3.8% year over year to $283.18 million. Adjusted net income and adjusted net income per share reached $6.07 million and $0.46, 139.8% and 155.6% more than in the same period of the previous year.
Analysts expect TREE’s EPS to rise 8% year-over-year to $0.81 for the quarter ending September 2022. Street expects revenue for the same quarter to rise 4.2% year-over-year. prior year to $310.02 million. Additionally, TREE beat consensus EPS estimates in each of the last four quarters, which is impressive.
Shares of TREE have risen 1.5% in the past five days to close their last trading session at $50.55.
Of the seven analysts who rated the stock, six rated it Buy and one rated it Hold. The 12-month median price target of $130.33 indicates a 157.8% growth potential. Price targets range from a low of $62.00 to a high of $190.00.
RELY shares were unchanged in after-hours trading on Monday. Year-to-date, RELY is down -56.79%, versus a -17.58% rise in the benchmark S&P 500 index over the same period.
About the author: Anushka Dutta
Anushka is an analyst whose interest in understanding the impact of broader economic changes on financial markets motivated her to pursue a career in investment research. Plus…