Source: Zhitong Finance Author: Zhuang Lijia
The Wells Fargo stock team provided a list of high-confidence tactics to go long and short in the second quarter, including 10 stocks to go long (or increase) and 4 to short (or reduce) stocks, including those in the “Big 7” of US stocks$Amazon (AMZN.US)$und$Tesla (TSLA.US)$. According to reports, the list is updated every quarter, indicating “areas where analysts believe there is a major catalyst for the second quarter of 2024.” Here are the details of this list.
Stocks that tactically go long:
The bank believes that the Amazon Logistics (FBA) fee restructuring is the next stage in Amazon's retail profit margin expansion, and is expected to drive retail business profit growth of 5.2 billion US dollars throughout the year.
The bank believes that the stock is trading at a corporate value of only $400 million, and its risk/reward is biased upward during the upcoming release of key data for the upcoming phase III clinical trial of ANX005, the main drug candidate. According to reports, ANX005 is a drug candidate developed for Guillain-Barré syndrome (GBS). GBS is a potentially fatal serious neurological autoimmune disease that can cause paralysis, neurodegenerative changes, and cognitive impairment. Currently, no treatment for this disease has been approved by the FDA for marketing.
The bank notes that it is confident in the positive data of IMPAHCT based on its in-depth research on the key risks and advantages of the IMPAHCT trial. According to reports, impaHCT refers to a clinical trial of inhaled iMatinib pulmonary hypertension by biopharmaceutical company AeroVate Therapeutics to evaluate AV-101, a novel imatinib dry powder inhalation preparation for the treatment of pulmonary hypertension (PAH). The bank added that in its scenario analysis, it believes that under basic circumstances, the stock price will rise 60%; in a bull market situation, the stock price will rise by more than 100%.
The bank believes that Citi is at the beginning of a turning point that has continued for many years, which should reflect better efficiency and returns, as its poor historical performance (including its worst performance in the fourth quarter of 2023) will be the best positive operating leverage in 2024.
The bank believes that based on the timing, location, and drill interval unit (DSU) density of recent drilling and completion activities in the Delaware Basin, as well as possible conservative assumptions in the 2024 production guidelines, Devin Energy may provide better-than-expected production guidance for the second quarter of 2024 and the first quarter of 2024, and exceed and increase the guidance throughout the year.
The bank believes that, based on the timing of new customer contracts and product launches in the second half of 2024, and conservative assumptions that may be included in the 2024 fiscal year guidelines, Global-E Online may exceed and raise the guidelines throughout 2024.
The bank believes that the key ASPEN research data to be released in the second quarter by the biopharmaceutical company Insmed for treating bronchiectasis is the stock's most meaningful upward momentum recently. The bank believes that under basic circumstances, the stock price will rise 70%; under a bull market, the stock price will rise more than 100%. Additionally, the bank notes that the company's Arikayce (used to treat pneumonia caused by Mycobacterium avium complex infection) and triprostacyclin palm inhaled powder (TPIP) provided the basic foundation for the stock.
The bank believes that Thor Technology's stock has been unfairly punished by the GTF engine recall, and market sentiment should improve as the backlog of grounded aircraft peaked and began to decline.
The bank said that due to poor performance and outlook for the 2024 fiscal year, the stock is unpopular, but the company's year-on-year base is easing, the price-earnings ratio is low, and profit margins are still in a favorable position.
The bank believes that SITE Centers has the potential to surpass its peers in the short term as the company sells more assets at preferential prices.
Stocks that have been tactically shorted:
The bank believes that the application software company is facing more and more intense competition in the B2B sector. At the same time, the company requires more investment than many investors expected, the market is increasingly skeptical about the company's terminal adoption rate and recent transaction monetization path, and unfavorable macro factors make the bank believe that the stock's price-earnings ratio is more likely to shrink rather than expand.
2,$Graphic Packaging (GPK.US)$
The bank believes that the global oversupply of cartons and demand for packaged food is still sluggish, which will cause the company's profits to be compressed in the first half of 2024.
The bank believes that from a strategic point of view, the stock's earnings will continue to face downside risks, mainly due to fundamental pressure, including lower-than-expected net self-payment revenue and the upcoming merger of the satellite radio service provider with Liberty Media.
The bank believes that Tesla's delivery volume growth will slow due to falling demand and reduced returns from price cuts. It is estimated that the delivery volume will be around 1.8 million vehicles in 2024, which is the same as 2023, and still about 10% lower than market expectations.
edit/lambor