Market Turbulence and Investing Approaches

February presented difficulties for the stock market, as issues with economic indicators, reduced consumer confidence, and trade tariffs led to fluctuations. The S&P 500 dropped by 1.4% throughout the month.

In this kind of market, investors are advised to concentrate on the stocks of firms capable of enduring short-term variability while seizing growth chances to achieve robust long-term returns. Gaining insights from leading Wall Street analysts, who perform thorough assessments of companies’ advantages, risks, and future possibilities, can offer significant value in pinpointing these stocks.

With this in mind, here are three stocks recommended by leading analysts, according to TipRanks, a platform that ranks analysts based on their track record.

Booking Holdings (BKNG)

The first stock mentioned is Booking Holdings, a major force in the online travel sector. The company recently announced remarkable fourth-quarter earnings, surpassing market forecasts, driven by ongoing robust travel demand. Booking Holdings is proactively investing in its future expansion through various strategies, such as incorporating generative AI to improve services for both travelers and partners.

After these solid outcomes, Evercore analyst Mark Mahaney maintained his positive outlook on BKNG shares, increasing his price target from $5,300 to $5,500. He noted that the company’s Q4 results were robust in every region and in all travel segments. Furthermore, essential business indicators like bookings, revenue, and room nights demonstrated growth.

Mahaney highlighted that although Booking Holdings is more than double the size of Airbnb and triple that of Expedia in terms of room nights, it still showed quicker growth in these essential areas in Q4 2024. He attributed this success to the company’s extensive scale, high profit margins, and seasoned management team, dubbing it the premier online travel stock available.

“We continue to view BKNG as fairly valued, with sustainable premium EPS growth (15%), robust free cash flow generation, and a steady history of performance,” Mahaney remarked.

He remains confident that Booking Holdings can sustain long-term growth targets of 8% in bookings and revenue, along with 15% EPS growth. He also highlighted the company’s long-term investments in merchandising, flights, payments, connected travel experiences, and AI-driven services, as well as its growing online traffic.

Analyst Ranking:

Mahaney holds the #26 spot among more than 9,400 analysts monitored by TipRanks, boasting a 61% success rate and an average return of 27.3% on his advice.

Visa (V)

The second stock recommendation is Visa, a global leader in payment processing. At its Investor Day on February 20, Visa outlined its growth strategy and emphasized the revenue potential in its Value-Added Services (VAS) and other business segments.

In light of the event, BMO Capital analyst Rufus Hone reiterated his buy rating on Visa, keeping a price target of $370. He observed that Visa tackled numerous investor concerns, such as the growth potential in consumer payments and the firm’s capacity to maintain high-teens growth in VAS.

Hone pointed out that Visa identifies a $41 trillion opportunity in consumer payments, with $23 trillion still not fully reached by current payment systems, suggesting substantial growth potential.

Concerning Visa’s VAS sector, the company offered further insights, forecasting long-term revenue growth of 9%-12%. Visa also anticipates a change in its revenue breakdown, with Commercial & Money Movement Solutions (CMS) and VAS emerging as the main revenue contributors, eventually overtaking consumer payments. In comparison, these two segments accounted for only about one-third of total revenue in fiscal year 2024.

Hone sees Visa as a cornerstone investment within the U.S. financial sector.

“We anticipate Visa will sustain double-digit revenue expansion over time, aligning with consensus forecasts of approximately 10% growth,” he concluded.

Hone is ranked #543 among TipRanks’ 9,400+ analysts, with a 76% success rate and an average return of 16.7% on his recommendations.

CyberArk Software (CYBR)

The last stock selection is CyberArk Software, a frontrunner in identity security solutions. The company recently announced strong Q4 2024 results, demonstrating ongoing demand for its cybersecurity services. On February 24, CyberArk hosted its Investor Day to address its financial achievements and growth prospects.

After the event, Baird analyst Shrenik Kothari reiterated his buy rating on CYBR stock and raised his price target from $455 to $465. He stressed that CyberArk continues to be a leading entity in cybersecurity and has substantially increased its Total Addressable Market (TAM) to $80 billion, from a previous $60 billion.

Kothari attributed this TAM expansion to rising demand for machine identity security, AI-driven security, and modern Identity Governance and Administration (IGA) solutions. He highlighted the fact that machine identities have surged 45x compared to human identities, creating a major security gap—one that CyberArk is well-positioned to address, especially following its Venafi acquisition.

Furthermore, CyberArk’s Zilla Security acquisition is aiding the company in bolstering its position within the IGA sector. Regarding AI-driven security, Kothari commended CyberArk’s innovation, notably the launch of CORA AI.

Looking ahead, management aims to achieve $2.3 billion in annual recurring revenue and a 27% free cash flow margin by 2028, driven by continued platform consolidation.

“With robust enterprise adoption, strategic execution, and a rich growth pipeline, CyberArk is poised for continued long-term growth,” Kothari stated.

Kothari is ranked #78 among TipRanks’ 9,400+ analysts, with a 74% success rate and an average return of 27.7% on his recommendations.

Concluding Remarks

Market volatility continues to pose challenges for investors, but selecting fundamentally strong companies with long-term growth potential can mitigate risks. Booking Holdings, Visa, and CyberArk Software stand out as top picks from leading Wall Street analysts, thanks to their strategic positioning, financial resilience, and ongoing innovation.

For investors looking for long-term opportunities, these three stocks could provide attractive returns despite short-term market variations.