Colgate-Palmolive has been highlighted as a top pick by analyst Dara Mohsenian for several compelling reasons. The company is poised to report its second-quarter earnings on July 26, and Mohsenian believes that it has the potential for significant growth. With pricing power and share gains in its favor, Colgate-Palmolive has already seen a 23% increase in its stock value in 2024, but according to the analyst, there is still room for further growth. Mohsenian also noted that the company’s pet business, particularly its ownership of Hill’s Pet Nutrition, is a strong asset that has been undervalued by investors. Overall, Mohsenian’s positive outlook on Colgate-Palmolive stems from its long-term structural advantage over its peers, which is expected to continue in the second half of the year and beyond.
Analyst Erik Woodring recently upgraded Apple to a top pick status, citing the company’s innovative approach to generative artificial intelligence, known as Apple Intelligence. Woodring anticipates that this technology will be a key driver of device upgrades for Apple, particularly with the upcoming cycles for the iPad and iPhone. Despite already seeing a 16.5% increase in stock value in 2024, Woodring believes that investors have not fully appreciated the potential impact of Apple Intelligence on the company’s future growth. The impending upgrade cycle for Apple is expected to have a significant effect on iPhone and iPad shipments, signaling a record-breaking cycle ahead. Apple is set to report its fiscal third-quarter results on Aug. 1, further solidifying its position as a promising stock to consider.
Cloud-scale applications software company Datadog has seen a slight dip in its stock value this year, prompting analyst Sanjit Singh to recommend buying ahead of its upcoming quarterly results on Aug. 8. Despite recent fluctuations in the stock’s valuation, Singh remains optimistic about Datadog’s long-term prospects. He highlighted the company’s strong execution in a challenging spending environment, predicting sustained growth for the future. Additionally, Singh identified margin upside potential and a pipeline of new products as factors that contribute to Datadog’s competitive position in the infrastructure software sector. While the risk-reward profile may not be as compelling in the short term, Singh believes that Datadog’s potential for long-term market share gains and attractive margins make it a standout choice for investors.
Other stocks recommended by Morgan Stanley ahead of earnings include Spotify Technology and Nu Holdings. Analysts have raised estimates for Spotify based on anticipated price increases and incremental margins, highlighting the company’s leading product position and underappreciated earnings power. Nu Holdings, on the other hand, has gained attention for its promising growth trajectory, with optimistic projections suggesting a substantial increase in valuation by 2026. The company’s strategic initiatives in Brazil and Mexico, as well as its Open Finance agenda, are expected to drive market share gains and solidify its position as a stock to watch in the coming years.
The stocks recommended by Morgan Stanley present compelling opportunities for investors looking to capitalize on the upcoming earnings season. With strong fundamentals, innovative technologies, and promising growth prospects, these companies are well-positioned to deliver long-term value to shareholders. It is essential for investors to conduct their own research and due diligence before making investment decisions, but these stocks serve as valuable considerations for those looking to diversify their portfolios and capitalize on market opportunities.