Top Wall Street Analysts Recommend These Stocks for Growth Potential

As optimism surrounding artificial intelligence (AI) continues to resonate throughout 2024, the S&P 500 has seen significant boosts, particularly benefiting key chip manufacturers and leading companies in the utilities sector.

For investors looking for sustainable returns, identifying companies with strong long-term growth potential is essential. Top Wall Street analysts provide valuable insights into the main factors that could drive a company's growth and help in selecting stocks likely to yield substantial returns.

Fortinet

One strong contender is Fortinet (FTNT), a cybersecurity firm that strives to become a leader in the secure access service edge market. The company harnesses the power of machine learning and AI to deliver advanced cybersecurity solutions.

TD Cowen analyst Shaul Eyal recently reaffirmed a buy rating for Fortinet, raising the price target from $75 to $90. According to Eyal, discussions with industry participants and channel checks indicate a recovery in Fortinet's business alongside healthy demand for its diverse product offerings.

Moreover, the analyst forecasts that Fortinet's revenue and billings for the third quarter will likely hit the upper limit of the company’s guidance, potentially exceeding expectations. Eyal projects a 12% revenue growth for Q4, supported by strong closure rates and an expanding sales pipeline.

A notable driver for Fortinet's strong recovery is traction in its operational technology products, driven by a long-term replacement cycle replacing outdated systems. The integration of AI in network solutions and a heightened focus on cloud security, particularly following their acquisition of Lacework, contribute to Fortinet’s positive outlook.

Eyal ranks No. 12 among over 9,100 analysts, boasting a success rate of 71% and an average return of 27.3%.

GitLab

Next on the list is GitLab (GTLB), an AI-driven, cloud-based software platform designed to enhance developer productivity, optimize operational efficiencies, and mitigate security risks.

Following a series of discussions with the company's management, Mizuho analyst Gregg Moskowitz reasserted a buy rating on GitLab with a price target of $62. The management's confidence in capitalizing on opportunities in a $40 billion addressable market stood out, as GitLab and Microsoft’s GitHub only hold around 5% of this software development lifecycle market.

Management anticipates strong momentum for GitLab’s Duo Pro product by 2025, spurred by the growing generative AI trend. Additionally, they expressed optimism regarding the GitLab Dedicated product, which is attracting unexpected customer interest and contributing to increased average revenue per user.

Overall, Moskowitz remains hopeful about GitLab’s capacity to execute effectively and maintain high growth, driven by multiple factors such as customer expansion, price adjustments, and upsell opportunities. He is ranked No. 321 among 9,100 analysts, with a success rate of 58% and an average return of 12.6%.

Nvidia

Lastly, we turn to Nvidia (NVDA), a semiconductor leader experiencing remarkable revenue growth due to rising demand for its sophisticated GPUs used in artificial intelligence model development and applications.

After an investor meeting with Nvidia's management, Goldman Sachs analyst Toshiya Hari maintained a buy rating for Nvidia, lifting the price target from $135 to $150. His enthusiasm stems from a better understanding of Nvidia's competitive advantages and the anticipated increase in inference workload complexity that will likely drive future demand.

Hari observed Nvidia's sustained confidence in the demand landscape, fueled by ongoing investments from data center operators in accelerated computing and GPUs amid the generative AI boom. The management also shared promising prospects for its upcoming Blackwell platform, which is expected to be a significant revenue driver both in the near term and beyond due to its role in enhancing the company's competitive edge.

As a result of recent industry shifts, including increased cloud spending and stability in order trends from major AI server manufacturers like Dell and Hewlett Packard Enterprise, Hari has upgraded his revenue estimates for fiscal years 2025 to 2027.

Ranked No. 32 among over 9,100 analysts, Hari has achieved a successful rating rate of 68%, contributing to an average return of 27.5%.stocks, growth, analysts