These 3 Stocks Will Outperform The Market

August
31, 2021

4 min read

This story originally appeared on MarketBeat

With the second-quarter earnings cycle all but finished there’s little to move the market other than analyst sentiment. The analysts are, for the most part, still pushing the S&P 500 outlook higher which means we should expect the index to continue moving higher. Monday’s analyst news from Marketbeat.com included upgrades on three names that we see as important. Not only are these stocks well positioned for revenue and earnings but with the analyst behind them, their share prices should outperform the market for the remainder of the year.

Duolingo, Inc Is A Hot Growth Stock 

Duolingo Inc (NYSE: DUOL) operates a language learning app in the United States and China. The app helps users learn 40 different languages and is gaining traction quickly. The company recently reported a strong second quarter and has received several notable upgrades because of it. The company received a Buy rating from Bank of America which views the company as the category leader and an expansion/market-share opportunity in the direct-to-consumer education market. The BoA price target of $160 compares to the consensus of $145 and recent price action near $125.

Analyst Nat Schindler: “We are constructive on LT opportunity given category leadership in language learning and the broader direct to consumer education industry still in the earlier stages of digitization. We think Duolingo investors will look favorably at the large addressable market, differentiated & extensible platform, and strong future margin growth potential vs the 6% EBITDA margins in our 2023 model which warrant a significant premium to peer group comps.”

Affirm Holdings Is Reaffirmed By The Market

Affirm Holdings (NASDAQ: AFRM) is a point-of-sale service for merchants and consumers that allows time-lapse payments akin to Katapult Holdings. The company received four notable price-target upgrades in the wake of some key news from Amazon.com that means rapidly accelerating revenue for Affirm Holdings. Amazon.com announced that it would add Affirm’s pay-over-time features to its check-out offerings which is good news indeed. 

Barclays stands out as the only analyst to upgrade the stock, from Buy to Overweight, but the consensus of the four latest shoutouts is an Overweight or Strong Buy. Their consensus price target is near $117 and compares to the broader consensus of $87 and current price action near $97.75. Share prices are up nearly 45% on the news but still offer value to shareholders. In our estimation, the new high price target of $120 matched by…