Lately, comments made by U.S. Treasury Secretary Janet Yellen emphasize how the measures taken under the Inflation Reduction Act have helped strengthen the labor market. Yellen’s efforts have been instrumental in generating a surplus of over 13 million job opportunities, helping to lower the United States unemployment rate.
Inflation figures in June 2022 peaked at 9.1%, but this subsequently declined to 3.2% in July 2023, signaling confidence to investors that the economy is gradually recovering. In fact, U.S. companies have even committed millions in manufacturing and clean energy investments since January 2021. Our economy is on a path to stable growth, and investors should buy in on these three top NASDAQ bargains soon.
PayPal Holdings (PYPL)
PayPal Holdings (NASDAQ:PYPL) is an online payment platform allowing for payment transfers for individuals and businesses. PYPL stock is down 20% year-to-date (YTD) as of the writing of this article.
Despite that, PayPal reported solid Q2 financials. Revenue of $7.3 billion grew 7.4% year-over-year (YoY), beating expectations by $30 million. Also, earnings per share (EPS) increased by 24% to $1.16, and net income grew to $1.03 billion — 402% YoY. PayPal believes that discretionary spending will rise as inflation cools, accelerating the growth of e-commerce.
The global payment processing solutions market is projected to grow at a 10.0% CAGR from $74.44 billion in 2021 to $192.61 billion by 2030. PayPal recently announced an exclusive multi-year agreement with KKR, where KKR will purchase up to 40 billion EUR of PYPL’s buy now, pay later loan receivables from Europe. PYPL has also recently begun collaboration with Microsoft to PayPal’s Pay Later system in the U.S., U.K., Australia, Germany, France, Spain and Italy. The company plans to also give U.S. customers the option to pay with Venmo in the Microsoft Store. PayPal also extended its partnership with the Phoenix Suns to continue as its Official Payments Partner and to be integrated across all payment channels operated by the Suns. PayPal and Venmo branding will be displayed on all Phoenix Suns jerseys.
Yahoo Finance reported 38 analysts predicting a mean 1-year price target of $86.11, spanning from $58.00 to $126.00. Most of those analysts rated PYPL stock as a Strong Buy or a Buy.
PayPal is building awareness and customer loyalty with its numerous partnerships. With the stock currently 5 times lower than its all-time high, PYPL is greatly undervalued right now and is a worthwhile addition to your portfolios.
Cisco Systems (CSCO)
Cisco Systems (NASDAQ:CSCO) is a leading network company manufacturing and supplying networking equipment. The business also provides industrial services to over 190 countries, and its worldwide recognition among consumers boosts higher sales.
Cisco has been growing rapidly in the past year, and the telecommunication industry is a key contributor. The global telecommunication market alone is forecasted to grow at a 6% CAGR from $1.81 trillion in 2022 to $2.65 trillion by 2030. That growth will be beneficial to Cisco in the long run.
The company reported strong financials following its recent quarter. Revenue of $15.2 billion grew 16% YoY, diluted EPS of 0.97 grew 43% YoY and net income came in at $12.6 billion — growing 36% since the same quarter in the company’s fiscal 2022 year.
In addition, Cisco announced its intent to acquire Working Group Two (WG2) to turbocharge its Mobility Services Platform. WG2 is a Norwegian company that developed a cloud-native mobile services platform, programmable to host APIs. If Cisco succeeds in acquiring WG2, which is highly likely given Cisco’s strong financials, it will be a turning point for Cisco over the long term. The platform helps organizations manage and optimize wireless networks, with mobility and wireless network management available for consumers.
Yahoo! Finance reported 21 analysts predicting a mean 12-month price target of CSCO to reach $57.21, with a range from $45.00 to $65.00. Cisco’s potential partnership with Working Group Two will be a major growth catalyst in the foreseeable future, and investors should buy this stock before the acquisition fully plays out.
Kraft Heinz (KHC)
Kraft Heinz (NASDAQ:KHC) is one of the largest food-beverage companies in North America, with several brands valued at over $1 billion. Some notable brands under Kraft Heinz are the consumer-preferred Kraft and Heinz, Oscar Mayer and Kool-Aid.
KHC stock is down 18% YTD. On the other hand, the food and beverage market is valued at $7,221.73 billion in 2023, projected to hit $9,225.37 billion in 2027 at a CAGR of 6.3%. Kraft Heinz reported FYQ2 revenue of $6.72 billion, down 2.55% YoY. That was likely due to price gaps in the industry lasting longer than predicted. Despite that, Chief Executive Officer (CEO) Miguel Patricio stated that the company is planning more in the long term as the company is generating revenue in that expected timeframe.
Kraft Heinz is the fifth largest food and beverage company in North America, beating Coca-Cola (NYSE: KO) and Mars Incorporated. Recently, Kraft Heinz announced it invested over $400 million to build one of the largest automated consumer packaged goods distribution centers in North America. The distribution center will enable Kraft Heinz to make its supply chain more efficient and easier to run. The company also announced its goal to reduce the use of virgin plastic by 20% by 2030, building upon its previous goal of making plastic 100% recyclable by 2025 and net-zero greenhouse gas emissions by 2050.
Yahoo! Finance reported 19 analysts with a mean 1-year price target of $41.10, ranging from $31.00 to $48.00; 14 of these analysts rate this company as a Buy or Strong Buy. With the company’s plans to improve its supply chain and reduce greenhouse emissions, KHC stock will rapidly grow in the foreseeable years.
On the date of publication, Michael Que did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
