TipRanks ‘Perfect 10’ List: These 2 Stock Picks Are Up Over 20% This Year

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Making sense of the stock markets is challenging and an easy task. The collective information generated by tens of thousands of stocks and traders gives investors everything they need to know, but sorting through that mountain of raw data presents an entirely different problem.

TipRanks makes it easy. The platform and data tools allow investors to bring order to the data vortex, providing the latest scoop on more than 9,600 stocks and 7,700 Wall Street analysts. For investors looking for a more refined tool, there is the smart punctuationa valuable data tool that aggregates 8 separate key factors for each stock, factors known to correlate with future returns, and uses them to create a reified score on a scale of 1 to 10. A stock with ‘Perfect 10’ scores high on most key factors, although a stock does not need to score high on all factors to earn a 10.

The Smart Score, and especially the 10, can guide investors to stocks that are poised to make a profit. That is a vital advantage, especially in a challenging market environment such as the last six weeks have shown us.

With this in mind, we’ve pulled out two Smart Score ‘perfect 10’ stocks that have outperformed the broader market this year. Let’s take a closer look.

Schlumberger Limited (VMS)

We will start with a company that combines the strengths of two major industries. Schlumberger is an oilfield services company, a company involved in the drilling, completion of wells and oil production in the hydrocarbon business. These are tasks that the big oil companies, with their own focus on exploration, sometimes can’t do well. By specializing, Schlumberger can fill a vital niche in a vital industry.

A combination of factors, including the coronavirus pandemic crisis and the Biden Administration’s policy downplaying fossil fuels, has put Schlumberger in serious stumbling blocks. A macro look at revenue tells the story. The top line for the full year of 2019 was $33 billion; that dropped to $23.6 billion in 2020 and $22.9 billion in 2021.

At the same time, Schlumberger’s earnings and share price have recovered to pre-pandemic levels. In summary, EPS for 4Q21 was 42 cents; this was 8% more than in the third quarter and an impressive 56% year over year. While full-year revenue remained low, the quarterly top line of $6.22 billion was the best print since 1Q20. Consequently, the company’s share price is up 36% this year, far outperforming the broader market.

going back to the smart punctuation, Schlumberger earns its ‘Perfect 10’ with bullish readings on 7 of 8 key factors. Hedge funds and individual investors are buying, and industry bloggers and news sentiment are very positive.

Among the bulls is Evercore analyst James West, who takes a long look at Evercore and sees it in a strong position for the near future.

“Schlumberger’s yield-focused strategy is clearly working as the company brilliantly executed a choppy 2021 and is poised for a major inflection as the bull cycle takes hold in 2022 and beyond. The company remains focused on generating returns above the cost of capital, increasing margins and free cash flow, and leveraging its technology leadership position.”

These comments support West’s outperformance (ie buy) rating here, and his $48 price target implies an 18% one-year upside. (To see West’s history, Click here)

West is not alone in his bullish stance. There is broad agreement on Wall Street about the positives for Schlumberger, as shown by the 14-to-1 breakdown, Purchase Revisions versus Holds. The stock is selling at $39.17 and its average price target of $44 suggests a 12% upside over the next 12 months. (See SLB Stock Analysis at TipRanks)

Euroseas, Ltd. (ESEA)

Now we will change our focus, from hydrocarbons to maritime transport. Euroseas is a shipping company, in business for over a century, focusing on shipping. The company operates a fleet made up of intermediate and feeder sized containerships, 16 in total. Vessels range from 18,000 tons dry weight to over 70,000 tons. The oldest ships date from the late 1990s, while the newest are from 2009. Euroseas has four new ships under construction, with staggered deliveries scheduled to begin in 1Q23 and continue through 1Q24.

Euroseas has benefited from the post-lockdown return to more open economic activity, especially from the resumption of global trade. While the supply chain crisis is hurting the company, higher freight rates are driving the bottom line. The company will report its 4Q21 results on February 15; a look back at the figures for the third quarter can serve to show general trends.

The company posted a top line of $23 million and EPS of $1.17. Revenue was up 86% year-over-year, while profit reversed from an increase of just 1 cent in the prior year quarter. On a negative note, EPS fell short of the expected $1.41. These occasional lapses in solid results could help explain the pattern in the stock price: an uptrend, with periods of volatility. Overall, ESEA shares have gained ~29% this year. The equity gains reflect the company’s strong position on the reopened global trade routes.

Maxim analyst Tate Sullivan likes what he sees in Euroseas, especially the company’s potential to turn cash into ships. He writes: “Based on $103.5 million of contracted EBITDA in 2022 and our estimates for future TCE fees on ships that have expiring contracts, we estimate that ESEA increases cash to $83 million in 2022 from $8.8 million in 4Q21E. . In fact, we now forecast that ESEA has more cash than debt by the end of 2023… With no higher costs and a net cash balance, ESEA may consider acquiring more ships, starting a dividend or buying back shares.”

To this end, Sullivan gives ESEA stock a Buy rating and places a $52 price target on the stock, indicating room for a strong 68% potential ahead. (To view Sullivan’s history, Click here)

While there are only 2 reviews on record for Euroseas, this small-cap carrier has flown under the radar, both agreeing it’s a buy and giving the stock a moderate buy consensus view. ESEA is trading at $32.04 and its average target of $51.50 implies a ~6`1% upside from that level. (See ESEA stock analysis on TipRanks)

To find great ideas for trading stocks at attractive valuations, visit TipRanks’ The best stocks to buya recently launched tool that unites all TipRanks stock insights.

Disclaimer: The opinions expressed in this article are solely those of the leading 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.



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