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Home›Stock split›4 stocks to buy before the bull market returns

4 stocks to buy before the bull market returns

By Edith Waits
June 29, 2022
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Amid growing signs that a strong bull market could be on the way for the US stock market, there are plenty of good beat stocks for long-term investors to buy.

A significant amount of economic data indicates that a new bull market could be closer than many think. For example, durable goods orders for the month of May accelerated considerably. Additionally, consumer inflation expectations fell this month, according to the University of Michigan, while the increase in the core consumer price index fell slightly in May from April. In addition, oil prices have fallen in recent weeks.

Of course, lower inflation will allow the Fed to raise rates more slowly, which will make the economy grow stronger than if the central bank were to tighten more quickly to fight inflation.

Moreover, several experts are recently saying that we could be on the verge of a bull market. One of these experts, Forbes Contributor John S. Tobey wrote in his June 24 column that “indicators of an upcoming bull market launch are everywhere – both traditional signals and unique developments.” Additionally, CNBC’s Jim Cramer recently claimed “there are several things that need to happen for the market to have a bull market in a bear market situation.” I believe the six items on his list have a greater than 50% chance of occurring.

These four names are stocks to buy now.

Teleprinter Company Current price
PYPL PayPal Holdings, Inc. $71.82
ROKU Roku, Inc. $89.09
BB BlackBerry Limited $5.74
AMZN Amazon.com, Inc. $107.40

Stock to buy: PayPal Holdings (PYPL)

Source: Michael Vi / Shutterstock.com

Like all businesses in the payment space, PayPal (NASDAQ:PYPL) should largely benefit from the continued strength in consumer spending.

As proof of this theory, look at what Visas (NYSE:V) CFO said on June 7. “In general, credit spending has been strong. It was strong across all income groups. He’s been strong on what you might call discretionary spending, on the right, particularly travel, dining and entertainment,” director Vasant Prabhu said.

Additionally, as worries about a recession dissipate and a bull market kicks in, PayPal’s price-earnings multiple is expected to climb significantly, while analysts are likely to significantly raise their estimates for the company, fueling a major rally in PYPL shares.

Roku (ROKU)

ROKU shares will continue to benefit from the TCL partnership

Source: Michael Vi / Shutterstock.com

As InvestorPlace contributor Nicholas Chahine aptly explained in his June 22 column on Roku (NASDAQ:ROKU):

Not much has changed in Roku’s business outlook. The world is still transitioning to the realm of {Roku} operations. The streaming trend is only getting stronger, so ROKU stock should continue to have tailwinds for years to come.

Indeed, streaming’s share of overall TV viewing continues to climb, hitting an all-time high 31.9% share of time spent on television in May.

However, a few things will change for Roku once the street overcomes its fears of a ruinous recession and gargantuan interest rates. After that, Roku’s stock multiple should jump and many investors will be less afraid to buy its shares. In the meantime, there have been rumors that netflix (NASDAQ:NFLX) is interested in buying Roku. Given Netflix’s significant issues and Roku’s growing and huge reach and advertising power, I wouldn’t be at all surprised if Netflix ended up acquiring Roku.

Additionally, easing supply chain pressures are expected to see more TVs sold with Roku’s operating system. Meanwhile, Roku’s new deal with walmart (NYSE:WMT), which allows viewers to purchase products on Roku for the first time, looks set to become very lucrative. Other retailers are likely to sign similar deals with Roku, creating a significant new revenue stream for the tech company.

BlackBerry (BB)

A BlackBerry (BB) sign in front of a corporate office in Silicon Valley, California.

Source: Shutterstock

BlackBerry (NYSE: BB) The Internet of Things business, which includes its leading QNX operating system for vehicles, continues to regain momentum. Last quarter, the unit’s revenue jumped 19% year over year to $51 million, and its gross margin was a very impressive 84%. now installed in 215 million vehicles worldwide. Finally, the unit won 14 designs last quarter.

Encouragingly, Blackberry was unable to keep up with demand for proof-of-concept testing from its automotive app store, known as Ivy. I continue to believe that Ivy will be a real game-changer for BlackBerry and BB stocks.

And the company, which recently completed the first quarter of its fiscal year 2023, is “looking to approach breakeven EPS and non-GAAP cash flow for fiscal year 24.” It also seeks to “generate positive EPS and non-GAAP cash flow beginning in FY25.”

Stocks to buy: Amazon (AMZN)

An image of an Amazon logo on a building

Source: Jonathan Weiss/Shutterstock.com

Several Wall Street analysts have been bullish on Amazon (NASDAQ:AMZN) those last weeks. Renowned Wedbush analyst Dan Ives named Amazon as one of four companies that will benefit from resilient enterprise spending for cloud transition

Similarly, Morgan Stanley expects Amazon’s cloud business to remain strong during the economic downturn, as less than 10% of the unit’s revenue comes from small businesses.

JPMorgan was also bullish on AMZN stock. Amazon remains a “better idea” for the company, as JPMorgan expects the company’s sales growth to accelerate in the second half. This idea is similar to my own thesis that the company will benefit from a rebound in the e-commerce sector once pent-up demand for travel cools somewhat. JPMorgan also expects Amazon to “gain share in under-penetrated categories,” and it kept a price target of $200 and an “overweight” rating on the name.

Additionally, going forward, Amazon’s decision to do a stock split should continue to result in more retail investors buying the stock than in the past.

As of the date of publication, Larry Ramer owned shares of BB. The opinions expressed in this article are those of the author, subject to InvestorPlace.com Publication guidelines.

Larry Ramer has researched and written about US stocks for 15 years. He was employed by The Fly and Israel’s largest business newspaper, Globes. Larry started writing columns for InvestorPlace in 2015. Some of his highly successful contrarian picks include GE, solar stocks and Snap. You can reach him on StockTwits at @larryramer.

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