As the financial landscape continues to evolve in 2024, optimism surrounding artificial intelligence (AI) is significantly influencing stock performance, propelling the S&P 500 upwards. This trend has opened opportunities in various sectors, particularly in semiconductor stocks and utilities, which have received a fresh influx of investor interest. With sustainable returns becoming a growing demand, investors must pinpoint firms exhibiting strong long-term growth potential. Analysts on Wall Street are uniquely qualified to illuminate the factors that can foster the long-term viability of these companies. Below, we delve into three standout stocks, endorsed by leading analysts, that could furnish robust returns in a rapidly changing market.
A prominent name in the cybersecurity arena, Fortinet (FTNT) is positioned to make strides in the secure access service edge (SASE) market. The company leverages advanced machine learning and AI technologies to enhance its cybersecurity offerings, positioning itself as a pioneer in this crucial domain. Recent insights from TD Cowen’s analyst, Shaul Eyal, highlight the sustained demand and recovery trajectory of Fortinet’s operations, leading to an increased price target from $75 to $90.
Eyal’s confidence stems from favorable discussions within the industry and extensive channel checks suggesting that Fortinet’s upcoming earnings could exceed expectations. Anticipated revenue for the third quarter is expected to reach the upper echelon of the company’s initial forecast, indicating the potential for further growth. The upcoming fourth quarter is projected to yield a 12% revenue increase, buoyed by robust closure rates and ongoing sales pipeline development.
Moreover, Fortinet’s operational technology product line is experiencing significant traction due to a long-overdue cycle of replacing outdated legacy systems. The advent of AI-powered networks and a heightened focus on cloud security—especially following Fortinet’s recent acquisition of Lacework—have well-positioned the company for continued success. Eyal’s rankings among his peer analysts further bolster confidence, given his successful track record with a 71% favorable rating and an impressive average return of 27.3%.
Another noteworthy contender is GitLab (GTLB), an AI-driven cloud software provider on a mission to elevate developer productivity and streamline operational processes. Mizuho’s analyst, Gregg Moskowitz, recently reaffirmed a buy rating with an updated price target of $62. His optimism largely stems from interactions with the management team, which exudes confidence regarding their strategic plans to harness opportunities in a vying $40 billion total addressable market.
In a market heavily dominated by players like GitHub, the combined market share of GitLab and Microsoft still hovers around a mere 5%. However, significant potential lies ahead, particularly with the anticipated uptake in GitLab’s Duo Pro product fueled by the generative AI trend projected to make waves in 2025. Furthermore, growing interest in GitLab’s dedicated offerings has led to increased customer engagement and higher revenue per unit—a promising sign for future financial performance.
Moskowitz’s analysis points to numerous pathways for GitLab to enhance its growth trajectory, including expanded user bases, price inflation, and upselling opportunities. Ranking at No. 321 among over 9,100 analysts ensures that Moskowitz’s recommendations are built upon a sound foundation, evidenced by a 58% success rate and average returns of 12.6%.
Finally, we turn our attention to semiconductor powerhouse Nvidia (NVDA), a juggernaut in developing advanced GPUs essential for AI model building. Following a productive investor meeting with Nvidia’s management, Goldman Sachs analyst Toshiya Hari raised the stock’s price target from $135 to $150, emblematic of evolving optimism surrounding the company’s robust demand outlook.
With the accelerated adoption of generative AI applications, companies are significantly ramping up spending on GPUs and accelerated computing resources, indicating strong future demand for Nvidia’s offerings. The introduction of Nvidia’s Blackwell platform further underscores its competitive edge—serving not only as a catalyst for revenue growth but also solidifying its place as a leader within the semiconductor landscape.
Analyst Hari’s upward revision in revenue estimates through fiscal years 2025-2027 is a direct response to favorable industry dynamics, including increased cloud expenditure and positive order trends from key AI server original equipment manufacturers like Dell and Hewlett Packard Enterprise. His influential standing—ranking No. 32 among more than 9,100 analysts—underscores the reliability of his insights, shown by a successful rating rate of 68% and an average historical return of 27.5%.
In a market perpetual with change, identifying and investing in stocks with long-term growth potential is crucial. The endorsements from top analysts for Fortinet, GitLab, and Nvidia reveal a landscape ripe with opportunity fueled by technological innovation and strategic adaptation. Investors focusing on these frontier companies can position themselves advantageously in a world increasingly defined by the impact of artificial intelligence. As each company continues to carve its niche, remaining attuned to market dynamics will be essential in realizing lucrative returns.