Any investor who has tried chasing popular stocks has likely learned the hard way that it’s extremely difficult to beat the market by following the herd. Instead, the best investing ideas are often those that are contrary to the prevailing market sentiment. Bank of America recently ran its Thematic Beats screen to identify stocks with exposure to long-term growth themes that its analysts believe are flying under the radar on Wall Street. By comparing its analyst team’s price targets and earnings estimates to consensus analyst estimates, Bank of America identified the following nine out-of-consensus stock picks for long-term investors.
D.R. Horton (ticker: DHI)
Bank of America’s Beat Factor score ranges from -100 to 100 based on how much the firm’s earnings and price targets vary from consensus estimates. With a Beat Factor of 100, D.R. Horton is the firm’s highest-scoring out-of-consensus stock pick. In a difficult market for U.S. homebuilders, D.R. Horton recently preannounced solid fiscal fourth quarter order growth of 11.4 percent. Analyst John Lovallo II says the company’s impressive management team and track record make it a top pick. Bank of America has a “buy” rating and $75 price target for DHI stock.
Generac Holdings (GNRC)
Unfortunately, due to the wave of large U.S. hurricanes in recent years, business for Generac Holdings has been booming. Generac holds roughly a 70 percent share of the North American standby and portable generator market, and the stock has a +98 Beat Factor score. Analyst Ross Gilardi says Generac has made progress in de-levering its balance sheet, and the robust 2018 Atlantic Coast hurricane season has provided a shot in the arm for demand. Bank of America has a “buy” rating and $64 price target for GNRC stock.
Intuit (INTU)
Intuit is one of the world’s largest financial management solutions companies, specializing in tax and accounting software such as TurboTax, QuickBooks and Quicken. Analyst Kash Rangan says Intuit is one of the better-managed software companies in the market with opportunities to expand operating margins over time. He says fiscal 2019 could be an inflection point for TurboTax Live, a service which he says will be the primary long-term growth driver for the company. Intuit has a Beat Factor score of 96. Bank of America has…
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