9 Upgraded Stocks to Buy in September
Analysts recommend these upgraded stocks in September.
The S&P 500’s steady march higher continued in August. The index is now up 20% year to date and more than 100% from its March 2020 lows, but investors who have missed out on the rally may still have opportunities in today’s market. Many economists believe the U.S. is in the early stages of a multiyear expansion cycle, and analysts still see plenty of fresh stock buying opportunities – even with the S&P 500 at all-time highs. Here are nine stocks to buy that were recently upgraded by Bank of America analysts.
ACV Auctions Inc. (ticker: ACVA)
ACV Auctions is an online used-car wholesale auction platform. Analyst Nat Schindler upgraded ACV following its second-quarter earnings beat and says the company is well positioned to gain market share and replace legacy wholesale car auctions. Schindler says investors should look beyond the current supply issues in the auto industry and focus on how ACV’s platform “significantly simplifies” the wholesale auction process. The stock’s upcoming lockup expiration Sept. 20 could be a headwind, but Schindler says ACV is attractively valued based on longer-term earnings projections. Bank of America has a “buy” rating and a $35 price target for ACVA stock, which closed at $19 on Aug. 27.
Caesars Entertainment Inc. (CZR)
Caesars Entertainment is a U.S. casino operator with significant exposure to Las Vegas. Analyst Shaun Kelley upgraded Caesars and says there are several things to like about the stock. Las Vegas gaming revenue is recovering nicely from the health crisis. Following restructuring efforts, Caesars now has higher margins than it had in the past. Kelley says Caesars has a major opportunity to expand its U.S. online gambling market share. Finally, Caesars is insulated from the struggling Macao gambling market. Bank of America has a “buy” rating and a $125 price target for CZR stock. It closed at $104.24 on Aug. 27.
Leslie’s Inc. (LESL)
Leslie’s is the largest U.S. retailer of pool and spa supplies. Analyst Elizabeth Suzuki upgraded the stock and says the Delta variant of COVID-19 will likely increase residential pool use through the end of this critical season. Google search volume for “pool installation” and “hot tub” remains elevated, and Leslie’s AccuBlue Home water testing rollout has been a success. In addition, price inflation is a tailwind for margins. Finally, Suzuki says Leslie’s stock has been attractively valued since its October 2020 initial public offering. Bank of America has a “buy” rating and a $36 price target for LESL stock, which settled at $24.45 on Aug. 27.
Spirit AeroSystems Holdings Inc. (SPR)
Spirit AeroSystems produces aerodynamic structural systems for large commercial aircraft. Analyst Ronald Epstein upgraded Spirit and says the stock’s pullback in recent months is an overreaction to struggles that customer Boeing Co. (BA) is having with its 787 and 737 Max planes. Epstein says a rebound in narrow-body plane demand, a more diversified product portfolio and a leaner financial model are all bullish catalysts. He projects that a recovery in 737 Max volumes and growth in non-Boeing programs will help Spirit generate positive free cash flow by 2023. Bank of America has a “buy” rating and a $50 price target for SPR stock, which closed at $40.90 on Aug. 27.
Eastman Chemical Co. (EMN)
Eastman Chemical manufactures fibers and plastics for industrial and consumer products. Analyst Matthew DeYoe upgraded Eastman and says the company has opportunities for revenue growth over the next two years as the auto and aerospace markets recover from the 2020 downturn. DeYoe says Eastman’s chemical intermediates division profits may be pressured in the near term, but the company’s ongoing innovation can help it capture additional market share. Management is increasing its focus on capital returns, and DeYoe says Eastman shares are undervalued. Bank of America has a “buy” rating and a $140 price target for EMN stock, which traded at $115.27 as of Aug. 27.
Simon Property Group Inc. (SPG)
Simon Property is a real estate investment trust that owns and manages regional malls and outlet centers. Analyst Craig Schmidt upgraded Simon and says the company’s second-quarter earnings report far exceeded his expectations. Occupancy improved in the quarter for the first time since the health crisis began, and Schmidt says positive same-store net operating income marks a bullish inflection point for Simon. The company recently increased its quarterly distribution by 7.1%, and Schmidt says he expects additional increases as free cash flow recovers. Bank of America has a “buy” rating and a $150 price target for SPG stock. SPG closed at $133.69 on Aug. 27.
Albany International Corp. (AIN)
Albany International produces materials used to make paper products. Albany also manufactures advanced aerospace components. Epstein upgraded Albany and says the production ramp of CFM International’s Leading Edge Aviation Propulsion turbofans could generate significant upside for Albany investors. Albany is the exclusive provider of fan blades, fan cases and spacers for the duration of the program. Epstein says Albany is a great commercial airline recovery play, and the stock should close its valuation discount to aerospace and defense peers in the medium term. Bank of America has a “buy” rating and a $105 price target for AIN stock, which closed at $79.60 on Aug. 27.
Hartford Financial Services Group Inc. (HIG)
Hartford is a diversified financial services and insurance company. Analyst Joshua Shanker upgraded Hartford and says the stock has one of the most attractive risk-reward skews in his coverage universe. Shanker is bullish on Hartford’s better-than-expected commercial property and casualty segment growth and surprisingly high group benefits margins in the second quarter. Hartford’s fundamentals suggest valuation upside, and Shanker expects aggressive stock buybacks in the near term. He says Hartford is on track to hit its target of at least 13% return on equity in 2022. Bank of America has a “buy” rating and a $76 price target for HIG stock, which closed at $68.18 on Aug. 27.
Viant Technology Inc. (DSP)
Viant Technology is an advertising software company. Viant is one of the smaller companies in the space, but Schindler upgraded the stock and says advertising software is an attractive, high-growth business. Viant is a leader in cookieless advertising channels, such as connected TV. Schindler says the company is well positioned since Google plans to phase out third-party cookies by the end of 2023. He is bullish on cookieless ads and says Viant will likely be one of the few winners in a cookieless advertising world. Bank of America has a “buy” rating and a $30 price target for DSP stock, suggesting more than 100% upside over the shares’ $14.07 close on Aug. 27.