All Analysts Agree These 3 Former SPAC Stocks are Buys
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From what to have for dinner to where to go on vacation, it can be hard for a group of people to reach a consensus. The same goes in the stock market where research analysts often have vastly differing opinions about a particular company.
That's why when all analysts have the same rating on a stock, investors should take notice. Although its doesn't guarantee the bullish or bearish consensus will be accurate, it certainly increases the likelihood.
Focusing on the bullish side of things, let's take a look at three companies that Wall Street firms agree are buys. All are mid-cap SPAC stocks that have unique growth drivers—and significant upside potential.
Is Aeva Technologies Stock a Good LIDAR Play?
Aeva Technologies (NYSE:AEVA) stock is trading about 50% below its February 2021 peak. Yet analysts covering the stock seem to think the autonomous vehicle technology maker is gearing up for another ride.
Since Aeva Technologies went the SPAC route, the Street has been quite bullish about the company's growth prospects providing next-gen LIDAR sensing and perception technology for the self-driving car market. All five firms call it a 'buy' and the price targets suggest the stock can double if not triple. The lowest target is $20, and Roth Capital has a Street-high $30 target.
Based on the daily chart, the technical analysis is also in agreement with the consensus view. Earlier this month a head and shoulders bottom pattern formed when Aeva Technologies was trading at $10.88. The bullish formation points to a possible run to $13.80 to $14.50 over the next couple months.
The stock climbed above $12 on June 8th as volume rose for the fourth straight-up day. The low volume pullback since offers investors an ideal entry for an autonomous vehicle play that analysts are sensing can go much higher.
Is PureCycle Technologies a Good ESG Play?
Shifting to a very different type of technology, PureCycle Technologies (NYSE:PCT) is another mid-cap with a unanimous buy opinion. After rallying above $35 in March 2021, PureCycle briefly dipped below $10 last month. The dramatic drop was precipitated by a bearish attack from short-selling firm Hindenburg Research. Among other things, it questioned that the company's lack of revenue and ability to revolutionize the plastics recycling industry.
PureCycle owns a global license to sell the only solvent-based purification recycling technology on the market. The technology was developed by consumer products giant Procter & Gamble and is designed to convert plastic waste into a reusable resin that's like brand new.
Analysts have been quick to show support for PureCycle Technologies and its ESG-friendly stock. Last month, Oppenheimer started coverage with a 'buy' rating and $24 target. Earlier this month, Alembic Global did the same but with a more optimistic $30 target. The other two firms that cover the stock also have 'buy' ratings although they have yet to provide an update in the aftermath of the short-seller report.
Since the Hindenburg report sank the stock on May 6th, it has doubled off the bottom. As it did when PureCycle emerged as one of the most intriguing ESG SPAC stories, the market has once again gotten behind this underdog, environmentally friendly story.
PureCycle's first manufacturing plant in Ironton, Ohio is scheduled to go live by the end of next year with an annual production capacity of 107 million pounds of plastic. Until then, investors will have to take a leap of faith that the technology, and analysts, have merit.
Is Genius Sports Stock a Buy?
London-based Genius Sports (NYSE:GENI) is a digital sports content and technology company. It compiles data from sporting events and sells it to some of the world's largest sports betting companies such as DraftKings, FanDuel, and William Hill. Genius Sports has already secured agreements with the NBA, PGA, FIFA, NCAA, and other major sports organizations.
The month of June hasn't been kind to Genius Sports shareholders. After the stock ran above $25 last month, roughly one-third of the market value was shaved this month. Last week the company completed a 22 million share secondary offering at a price of $19.00 to fund its growth ambitions. Some shareholders haven't taken kindly to the dilution and the stock is now on a five-day losing streak.
Fortunately, Genius Sports seems to have support around the $16 to $17 level as it has twice this year. It has also found the support of sell-side analysts. This week Oppenheimer issued a 'buy' rating and $32 target which represents 80% upside from here. It was the fourth firm to issue a 'buy' rating on the stock in the last 30 days.
Genius Sports has covered nearly a quarter-million sporting events and is known to have some of the best technology in the sport betting and sports media industries. Given the explosive growth forecast for the global sports betting market, it could be a genius move to invest in this stock while its in a bit of a slump.
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