Spotlight on Three Bullish Stock Picks: Uber, Datadog, and Nvidia

Welcome back to the Extreme Investor Network, your trusted resource for navigating the complexities of investing in today’s market. As the new year unfolds, uncertainty looms, particularly around inflation and monetary policy. Federal Reserve officials have signaled caution, which makes it crucial for investors to carefully select their stocks to enhance portfolio returns. In this blog, we explore three compelling stock picks that analysts are buzzing about, each with solid financials and significant growth potential.

Uber Technologies (UBER)

First on our list is Uber Technologies, the ride-sharing and food delivery powerhouse. Recently, analysts from Mizuho reiterated their bullish stance on Uber, highlighting a buy rating with a price target of $90. What’s driving this optimism? According to Mizuho’s analyst James Lee, 2025 is envisioned as an investment year for Uber, aiming to capture market share despite forecasts that may dampen short-term earnings.

Uber’s growth strategy is vital. Lee anticipates a compound annual growth rate (CAGR) of 16% in core gross bookings from FY23 to FY26, targeting growth figures that align with the company’s analyst-day targets. Furthermore, he predicts improvements in Uber’s EBITDA growth, which is projected to soar at a rate of 30-40%. The lifting or improvement of operational efficiencies and economies of scale should mitigate margin risks as Uber leans into growth investments.

Interestingly, doubts regarding the Mobility segment seem exaggerated. Analysts expect stable gross bookings growth in 2025, aided by new verticals in delivery, such as grocery services, which are seeing ever-increasing adoption rates across North America. With operational checks at an all-time high and market share retention metrics looking favorable, Uber is a stock worth watching.

Datadog (DDOG)

Next up is Datadog, a leading player in cloud monitoring and security solutions. Analysts at Monness remain bullish, maintaining a buy rating and a price target of $155. The company has weathered challenges in the software landscape, showcasing robust operational performance.

Analyst Brian White pointed out that Datadog is uniquely positioned in today’s tech landscape, especially concerning the burgeoning trend of generative AI, which he believes offers significant long-term growth prospects. Notably, AI-native customers contributed over 6% to Datadog’s annual recurring revenue in Q3 2024, highlighting the growing relevance of AI to their business model.

Datadog’s strategy includes a balanced approach to AI technologies, steering clear of the overambitious claims that often cloud the narrative in the software sector. With transparent insights into its AI innovations, such as LLM Observability and Bits AI, Datadog is well-positioned to capitalize on digital infrastructure shifts that favor cloud-native solutions. Given the analyst’s favorable track record—profitable 69% of the time with an average return of 20%—this stock remains a gem in the tech sector.

Nvidia (NVDA)

Last but certainly not least, we delve into Nvidia, the semiconductor giant riding high on the wave of generative AI. Recently, analyst Harlan Sur from JPMorgan reaffirmed a buy rating with a price target of $170, emphasizing Nvidia’s pivotal role in meeting the skyrocketing demand for its advanced GPUs.

Nvidia stands at the forefront of AI and data center innovations, with its Blackwell platform on track for ramp-up despite ongoing supply chain constraints. Sur anticipates robust spending in the data center space, further fueled by Nvidia’s competitive edge and the growing preference for their solutions over traditional ASIC models.

Key takeaways from Sur’s analysis indicate that Nvidia’s strategy extends beyond its current stronghold in gaming; the company is poised for expansive growth into markets like AI PCs. With an impressive analyst ranking—profitable 67% of the time with an average return of 26.9%—Nvidia certainly deserves attention as it continues to forge ahead in transformative technologies.

Conclusion

In an investment landscape fraught with challenges, these three stocks—Uber, Datadog, and Nvidia—present promising opportunities bolstered by strong fundamentals and positive analyst sentiment. As active participants in the market, it’s essential to stay informed and consider these insights from leading analysts.

At Extreme Investor Network, we’re committed to helping you make informed investment decisions. Stay tuned for more expert analyses and insights as we navigate through 2024 together!