Top 5 Stocks Trending in the Everything Money Community

Today, we’re diving deep into the top five stocks that our Everything Money community is buzzing about. We’ll look at metrics, trends, and insights that could shape our investment decisions. Let's dive into each one.

1. ATKR (Atkore Inc.)

We've discussed Atkore before, a company specializing in electrical nodes and devices. Here’s a snapshot of its recent performance:

• All-Time High: $195 (April)
• 52-Week Low: $80 (September 11, 2024)
• Current Price: $84 (up 5% since September low)
  

This stock has taken a hit, but our community is eyeing it closely because fundamentals remain strong despite a drop in share price. Here’s what stands out:

• Market Cap: $3.2 billion
• Enterprise Value: $4.3 billion (indicating around $1 billion in net debt)
• Free Cash Flow: $400 million last year, averaging $450 million over the past 5 years, slightly below net income
  

Now, let’s look at valuation metrics that caught our attention:

• P/E Ratio: 5.8
• Price-to-Free Cash Flow: 8
• Dividend Yield: 36%
  

Key Questions to Consider:

• Revenue trends are slightly concerning, with recent drops from a high of $3.9 billion to $3.3 billion over the past year.
• Declining Revenue: Is this a temporary post-COVID adjustment, or is it a more permanent downturn?
  

We ran Stock Analyzer for ATKR, using conservative revenue growth rates: -2%, 1%, and 4%, and profit margins ranging from 10% to 18%. The resulting intrinsic value hit $86 on the nose—a rare exact match. Based on these projections, the stock could potentially yield returns of 20% or even 30% annually if assumptions hold true. Recommendation: Take a deeper look, as the stock might be undervalued at current levels.

2. Alphabet Inc. (GOOGL)

Alphabet (Google’s parent company) is another favorite. This tech giant hit an all-time high of $193 in July, with a recent low of $121 in October last year. Today, it trades around twice that low, highlighting the fluctuating tech landscape.

Key Financial Highlights:

• Market Cap: $2.1 trillion
• Free Cash Flow: $61 billion (versus $88 billion in net income last year)
• 5-Year Average Free Cash Flow: $57 billion, with net income close at $63 billion
  

With Google, you’re investing in a powerhouse that controls two of the largest search engines, Google and YouTube. Alphabet's balance sheet is clean, but we need to remember: quality often commands a premium price. Here’s what the eight-pillar analysis reveals:

• Six Checks, Two Xs: The two Xs are valuation-related. But high growth stocks often come with premium valuations.
  

Stock Analyzer Assumptions:

• We used a conservative growth rate of 7.5% (likely below Alphabet’s real rate) and a profit margin of 24%. The tool gave a fair value near $201, suggesting Alphabet could deliver an 11.5% return. Recommendation: Worth consideration for a long-term hold due to its quality and market dominance.

3. Alibaba (BABA)

Alibaba has surged recently, gaining 54% over the last six months and 45% year-to-date. However, uncertainties in China have led to a volatile ride. Despite some ongoing geopolitical risks, Alibaba's long-term prospects remain intriguing.

Stock Highlights:

• All-Time High: $320
• 52-Week Low: $66
• Current Performance: Up nearly 100% since its low in early 2022

Financial Fundamentals: 

Alibaba boasts strong cash flow and continues to grow, even if revenue has slowed slightly in recent years. Today, it trades at just 13 times free cash flow—a potential bargain for a high-growth tech company.

Stock Analyzer Estimates:

• Revenue growth at 3%, 6%, and 9% scenarios, with profit margins of 12% to 18%.
• Intrinsic value range: Low: $105 to $130; High: $285 to $330; Middle: $175 to $210

This broad range reflects Alibaba’s potential to rise significantly in the long term, though further research is essential. Recommendation: Worth considering for investors willing to navigate some risk.

4. Nike (NKE)

Nike, a top global brand, has faced public relations issues but remains a strong business. After hitting $179 in November 2021, Nike’s stock now sits around $81. Some investors argue that it’s an opportunity to buy a premium brand at a discount.

Financial Snapshot:

• Market Cap: Large, with consistent revenue growth in the high single digits to low double digits.
• Revenue Growth Estimate: 52 billion today, aiming for 66 billion in the next five years.
• Earnings Per Share (EPS): Expected to nearly double within five years.

Nike’s stock analyzer setup includes 3%, 5%, and 7% revenue growth rates, with a premium P/E ratio ranging from 20 to 26, owing to its strong brand. Intrinsic Value Estimates: Low of $60, high of $119, and a middle ground at $85. Recommendation: This stock is on our watch list, especially if it dips lower, as it holds strong long-term potential.

5. Celsius Holdings Inc. (CELH)

Our final stock is Celsius, a company known for its healthy energy drinks. Despite a recent 72% drop, Celsius is up a whopping 3,000% over the past five years. It’s a volatile yet high-growth investment.

Key Financials:

• Market Cap: $7.8 billion
• Enterprise Value: $7.4 billion, indicating a solid balance sheet with minimal debt
• Revenue Growth: Doubling annually in recent years (from $75 million five years ago to $1.5 billion today)

Celsius stands out with its rapid revenue growth but remains a risky play due to its high valuation and competitive industry. A recent $550 million investment from Pepsi shows big brands are betting on its future.

Stock Analyzer Assumptions:

• Revenue growth estimates range from 4% to 12%.
• Target profit margins of 15% to 25%.
• Intrinsic Value Estimates: Low of $15, high of $67, middle of $33.

Final Thoughts on Celsius: 

While Celsius is exciting, we recommend waiting for a larger margin of safety or a potential acquisition offer from a larger brand.

Closing Thoughts

Every investment is a bet on the future, and in our Everything Money community, we prioritize finding stocks with growth potential and sound fundamentals.

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