Goldman Sachs Sticks to Their Buy Rating for HDFC Bank Limited (HDFCBANK)
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According to TipRanks, Jain is a 3-star analyst with an average return of 9.8% and a 78.57% success rate. Jain covers the Financial sector, focusing on stocks such as Axis Bank Limited, Bajaj Finance Limited, and IDFC First Bank Ltd..
In addition to Goldman Sachs, HDFC Bank Limited also received a Buy from Macquarie's Suresh Ganapathy in a report issued on July 3. However, on June 28, J.P. Morgan maintained a Hold rating on HDFC Bank Limited (NSE: HDFCBANK).
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CNBC
5 hours ago
- CNBC
Market concentration around AI darlings persists. It's making investors worried
The stock market continues to be extraordinary in the face of distressing headlines, but the growing concentration risk has more investors on edge. The S & P 500 is back at all-time highs as the bull case on Wall Street plays out. The artificial intelligence buildout is ramping up. Corporate earnings are topping expectations. Interest rate cuts seem inevitable, likely coming next month. On top of all that, the One Big Beautiful Bill will be stimulative for an economy where consumers are still spending. But the market's ascent at a time of seasonal weakness and ongoing inflation concerns has many investors worried. They fear that a stock market priced for perfection, with the S & P 500 currently trading at a 12-month forward multiple of 22, is vulnerable to some sort of setback. And that could come from anywhere. "What's going to happen, I think, is some shock will occur. I don't know what shock, but some shock will occur, which undercuts the thesis of continued economic growth," said David Kelly, chief global strategist at JPMorgan Asset Management. "And when that happens, I think you'll see a selloff in markets, and that'll probably be concentrated in those areas that look most overvalued right now." "So, I think investors ought to be pretty cautious here, because what's going on is the market slowly getting more and more overvalued," Kelly said. Top-heavy market More than anything, it's the top-heavy nature of the market raises concern. Goldman Sachs pointed out this week that the top 20% of quality companies in the S & P 500 — those with massive cash piles and fortress balance sheets — are trading at a 57% price-to-earnings premium to the lowest quality stocks — a gap in the 94th percentile going back to 1995. In practice, that means that the megacaps — which already benefit from AI tailwinds — get a further boost from investors seeking safety from economic uncertainty. Yet, the influence the tech giants wield on the market is troubling in the event of a pullback. AI superstar Nvidia alone now accounts for roughly 8% of the S & P 500, the biggest weighting of any individual stock in the cap weighted benchmark going back to 1981, according to Torsten Slok, chief economist at Apollo Global Management. The stock is easily a key reason for the bull market, after rallying more than 36% this year, surging more than 170% in 2024, and soaring more than 200% in 2023. But, if the bull case for the beloved stock falters, that could spell trouble for the broader benchmark. China, for example, is a key weak point for the stock, as any curbs on Nvidia's sales of its graphics processing units to Beijing will likely hurt the stock — and also the market. An incoming reversal? The top stocks look especially bloated when you consider this: While the S & P 500 has gained more than 10% in 2025, the median stock has only risen 3%, and remains 12% off its recent high, according to a note from Goldman Sachs this week. To be sure, that could set up the market for big rotations. Small-cap stocks outperformed their large-cap counterparts this week. Value-factor stocks also outpaced growth, while Nvidia slid and Apple advanced. Health care, a recent laggard, led the S & P 500. If the dovish outlook for Fed policy holds, or the macroeconomic picture improves, then the rotation trade could continue to work for investors. And yet, even optimistic investors continue to remain cautious, and are diversifying their holdings. JPMorgan's Kelly said he prefers assets with limited downside in the event of a pullback. The strategist prefers U.S. value stocks over growth, and said he's looking abroad to Europe, which he expects has further to run even after its gains this year. Some alternatives such as real estate could also add value to a portfolio, he said. Eventually, Kelly expects some "violent" reaction — a sustained bear market of 20% or more — is overdue for the stock market, whether it comes within a week or in the next three years. "It's just imperative that investors diversify some of that risk into other industries and other regions in particular," said Nanette Abuhoff Jacobson, global investment strategist at Hartford Funds. Reversal beneficiaries This past week, Goldman Sachs identified some lower quality stocks with weak balance sheets that could benefit from a reversal trade, if macroeconomic conditions improve or if the Fed turns dovish. Here are five of them. Estee Lauder was one lower quality stock identified. The stock is higher by more than 21% in 2025 but is in the midst of a multiyear turnaround plan that could cost between $1.2 billion and $1.6 billion. Paramount Skydance surged 33% this week alone, after it became a "play for momentum goons" after Paramount Global's merger with Skydance Media finalized. — CNBC's Sean Conlon contributed to this story.
Yahoo
6 hours ago
- Yahoo
2 Stocks That Nail a ‘Perfect 10'; Analysts Say ‘Buy'
What's the secret to picking the right stocks? It's the first – and often the hardest – step toward building a winning portfolio. Every investor has a method: some rely on gut instinct, others on expert opinions, and many turn to technical analysis. Elevate Your Investing Strategy: Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. Each approach has its merits, but for those who prefer a data-driven edge, there's TipRanks' Smart Score – an AI-powered system that turns mountains of market data into clear, actionable insights. By analyzing millions of daily trades and grading every stock against proven performance factors, Smart Score distills the complexity into a simple 1-to-10 ranking. A 'Perfect 10' signals a stock with strong potential, and when that rating aligns with Wall Street's own bullish outlook, it's a combination worth paying attention to. We dug into the TipRanks database to find just such opportunities – and uncovered two 'Perfect 10' stocks that analysts are also backing with conviction. Let's take a closer look. Regal Rexnord (RRX) Regal Rexnord, the first Perfect 10 stock we'll look at, is a manufacturing company that specializes in motion control. That is, the company designs and builds tools and solutions for power and transmission systems for moving systems. Regal Rexnord's product lines include such items as AC drives and controls; electric motors; clutches and brakes; bearings; couplings; gearings; industrial chains and sprockets; mechanical power transmission components; and predictive maintenance systems – and that list is by no means exhaustive. Motion control is a vital aspect of modern industry, and Regal Rexnord is an expert at it. The company's products, as can be expected, have found application in a wide range of industrial fields, including the aerospace and automotive industries; quarrying; cement manufacturing; industrial fans; commercial laundries; farming and agriculture; again, the list is long, and this only touches some of it. The point here is that Regal Rexnord is a major player in American manufacturing. That can be seen from some of the numbers involved. The company boasts a market cap of more than $9 billion. Last year, Regal Rexnord brought in some $6 billion in total sales. Zooming out for a macro view, we see that Regal Rexnord has over 30,000 employees worldwide, operating a network of manufacturing facilities and sales and service offices. The company has been in business since 1955, and keeps its headquarters in Milwaukee, Wisconsin. In its last earnings report, released on August 5 and covering 2Q25, the company showed just under $1.5 billion in quarterly revenue. This represented a 3.2% decline year-over-year, but edged over the forecast by 10 million. The firm's $2.48 non-GAAP EPS was 4 cents better than expected. In some other key points, the company reported an adjusted free cash flow of $493 million – and in early July, the company won a $35 million data center contract, and expects to see significant additional business with that customer going forward. For Baird analyst Michael Halloran, this company's sound pipeline for future orders outweighs the slow-moving second quarter. Halloran writes of RRX, '2Q orders were directionally sluggish, but underlying momentum is beginning to build as indicated by healthy July orders (+4%) including large data center wins with line of sight for more to come. Additionally, management sees ~+MSD% growth in orders in 2H (strong IPS/AMC, negative PES). Combined with cross-selling synergies, cost synergies, and debt paydown, cumulatively, we see an attractive 2025 exit rate/2026 earnings profile… Recognizing risk remains (primarily shipment timing) we continue to believe RRX will benefit meaningfully from a cyclical recovery, has more secular tailwinds than investors realize, and has a strong long-term opportunity approaching (dynamic earnings/FCF profile that remains undervalued). Combined, RRX remains a top idea.' This 'top idea' gets an Outperform (i.e., Buy) rating from Halloran, with a $180 price target that indicates potential for a 22% upside in the year ahead. (To watch Halloran's track record, click here) The 9 recent analyst reviews of RRX shares include 7 Buy and 2 Holds, for a Strong Buy consensus rating. The stock is priced at $154.57, and its $176 average price target implies that the shares will appreciate by 14% in the next 12 months. (See RRX stock forecast) FTAI Aviation (FTAI) The second Perfect 10 stock we'll look at is FTAI Aviation, another American industrial specialist. FTAI bills itself as 'providing power for the aftermarket;' in simpler terms, the company is known mainly for providing maintenance and upgrade services for both CFM56 and V2500 commercial airliner engines. That's a highly niche role, but an important one – many airlines don't own all of their flight equipment, but rather lease engines and maintenance plans from third-party providers. This arrangement allows the airline to focus on its core work of scheduling and flying, while FTAI and its peers provide and keep track of the engines. In addition to airliner engines, FTAI will also purchase commercial airliners for leasing to airlines. The arrangement is similar to that for engines, and for the same reasons. FTAI is known as an important owner/provider of Boeing 737 and Airbus A320 aircraft. FTAI provides maintenance support for its leased aircraft and engines. Prominent among the company's services are its module factory overhaul services and its engine piece parts and kits. These services are vital for maintaining or replacing engine fans and turbines, the beating hearts of modern jets. The company's largest facilities, capable of updating or repairing as many as 25 engines per month, are located in Canada. These are supplemented by modern facilities in the US, dedicated to light repair, module swaps, and field services. The company also has important facilities in Europe, where it conducts module maintenance and piece-part repair, and can turn out 150 engines each year. FTAI has global certifications, an important qualification in a worldwide business like commercial aviation. In its 2Q25 financial release, FTAI reported quarterly revenues of $676.2 million, for an impressive 52% year-over-year increase and beating the forecast by $129.6 million. The company's bottom line, of $1.57 per share, was 19 cents per share better than had been expected. The company finished Q2 with $301.9 million in cash and other liquid assets on hand. 5-star analyst Brian McKenna, of Citizens JMP, covers this stock, and he sees FTAI in an all-around solid position. Laying out the company's situation, McKenna says, 'We believe 2Q25 results represented another inflection for FTAI, specifically related to underlying cash flow and GAAP earnings as well as the capital structure. Based on the outlook for FCF in 2H25 as well as the firm's $300M cash position, we think there is an increasing probability that FTAI will be in a position to accelerate the pace of capital return to shareholders in 2026 (i.e., dividend increase and/or buybacks), even after allocating a sizable portion of this excess capital to other strategic growth initiatives. The momentum in Aerospace Products is nothing short of impressive, and we see significant upside in this business over time, which will only be accelerated as SCI scales further from here (i.e., 2026 vintage, etc.).' Looking ahead, the analyst describes an upbeat outlook, writing, 'So, we believe the fundamental outlook for FTAI has never been better, and we remain buyers of the stock, specifically as we see idiosyncratic upside in both earnings and shares over the next several quarters.' As a buyer of the stock, McKenna rates FTAI shares as Outperform (i.e., Buy), and he complements that with a $205 price target that implies a one-year upside potential of 40%. (To watch McKenna's track record, click here) This stock's 9 recent analyst reviews break down to a lopsided 8 Buys and 1 Hold, supporting the Strong Buy consensus rating on the shares. FTAI has a current selling price of $146, and its average price target, $180.89, suggests that the shares will gain 24% on the one-year horizon. (See FTAI stock forecast) To find good ideas for stocks trading at attractive valuations, visit TipRanks' Best Stocks to Buy, a tool that unites all of TipRanks' equity insights. Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment. Disclaimer & DisclosureReport an Issue
Business Insider
8 hours ago
- Business Insider
Holding cash in case a bear market hits? Here's where and when to invest if stocks plunge.
If you've been building up a big cash reserve over the last few years, you're not alone. You're also probably not alone in wishing you'd had the money in stocks. Cash has generated meaningful yields since 2022 after the Federal Reserve went on a rate-hike spree, drawing record amounts into money market funds. The total value in money market funds — highly liquid, cash-equivalent assets that generate yield from short-term bonds — is at a record $7.3 trillion. About $2.1 trillion is held by retail investors. Even stock-investing icon Warren Buffett holds a record cash position worth nearly $350 billion as of March. But stocks have ripped higher in the meantime. The S&P 500 is up 80% since its October 2022 low. It's been difficult to know when to get into the market, though. With the stock market consistently hitting new highs and valuations historically elevated in recent years, you might have been waiting for a good opportunity to put that cash to work in equities, waiting for a dip to buy. If you missed the April plunge, you might still be doing so. It's not necessarily a bad approach. Goldman Sachs said this week that the chance of a stock-market pullback has jumped. In fact, stocks are so expensive that Vanguard said this mont that its ideal portfolio over the next 10 years is a very conservative allocation of 70% bonds and 30% stocks. The cheaper the entry point, the better the returns. But timing the market is tricky and something market pros usually advise against trying. No one knows how long a bull rally can go or how long an eventual pullback will last. That's why the best course of action is probably to dollar-cost-average, continuing to put money into the market at set intervals, whether the market is up or down. However, if you are resolved to waiting for a significant decline to enter the market, it's a good idea to have a plan set in place before that moment arrives. When and what to buy Though bear markets in recent years have been short-lived, the average bear market going back to 1932 has seen a 35.1% drawdown that lasts a year and a half, according to investment bank Stifel. So take it slow, says brokerage firm Charles Schwab. "Instead of going all in at once, one might consider buying small chunks at a time," Charles Schwab said in an August 6 post. But not too slow, said Hank Smith, the director and head of investment strategy at Haverford Trust. There's no way to tell when the bottom is in, so you want to start taking advantage of the pullback once it hits 10% correction territory, he said. It may hurt if the market ends up falling further than 10%, Smith said, but being indecisive about when to get in can result in missed opportunities. Remember the 19.9% decline in the S&P 500 from February to April? The pain was over in the blink of an eye, with the index back at all-time highs before the end of June — and the rally has been furious, with the market up 30% since April lows. So if the market does continue to drop, it's time to get even more aggressive, Smith said. "Let's say that correction morphs into a bear market of 20%, and now you're kicking yourself that you put any in at down 10%. You can't do that," Smith told Business Insider. "You have to say, 'Ok, this is another opportunity to tranche in again,' and probably with more than you did at down 10%." As for areas of the market to buy, it's difficult to know which sectors and themes will get beaten up the most. But Schwab said it's good to take a diversified approach and start buying all corners of the market. "Interestingly enough, traders can diversify their portfolios with as few as 12 stocks, targeting stocks in all major sectors," the firm said. "Although diversification doesn't eliminate the risk of experiencing investment losses, it can help increase the chances of capturing better-performing assets and avoid the risk of losing overall portfolio value to any single business, industry, or sector." Quality dividend stocks can also provide a good buffer to market losses, Merrill and Bank of America Private Bank said in a 2024 report. Smith said that economically sensitive sectors usually make for some of the best opportunities coming out of a recessionary bear market, as they dip during downturns and rebound when the economy recovers. Funds like the Fidelity MSCI Consumer Discretionary Index ETF (FDIS) and the Invesco Dorsey Wright Consumer Cyclicals Momentum ETF (PEZ) offer exposure to cyclical stocks. But he also said large-cap tech stocks are likely to drop the most because of how high their valuations are. If that's the case, it will likely be a good chance to add exposure to them, he said. "That's very common in high-growth stocks to have big sell-offs in what is a longer-term bull trend," Smith said. "That is where an investor with a lot of cash waiting for a significant decline in the market should look to."
