As investors were so righteously reminded on Friday, many of the day-to-day Wall Street prognostications and strategy calls are almost always “best guesses” or data-based “assumptions.” The Wall Street consensus for the April nonfarm payrolls was 965,000, which made the 266,000 print miles off the actual mark. So, once again, for analysts and strategists it was back to the drawing board. The bottom line is that the drastic change in the way business is being done and has been conducted over the past year may mean some big changes are coming in the future.
The biggest coming change may be that productivity will jump drastically, so gross domestic product growth may be very high with less labor participation, which could be a real game-changer. While the rotation to cyclical and value probably remains in place, it is smart to look to the future for stock ideas.
We screened the Jefferies top growth stocks to buy this week for ideas that fit into this potential changing narrative, and we found four that look like outstanding growth plays for more aggressive investors. It is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.
This is one of the top picks across Wall Street in the mining and metals sector, and it is an outside way to play the electric vehicle trend. Freeport-McMoRan Inc. (NYSE: FCX) is the world’s largest publicly traded copper and moly producer, as well as the eighth largest gold producer. Its key operating and development assets are in Indonesia, North America, South America and Africa.
Highly leveraged toward copper mining, the company could be a big player in a scenario of rebuilding and repairing old and battered projects, and it clearly would benefit from stronger demand and higher prices for industrial commodities.
Jefferies has remained bullish on the company for some time and noted this in the research report:
We hosted a global call with Trafigura’s Chief Economist. He remains bullish on the current commodity cycle and sees room for significant further upside potential to commodity prices over the next one to three years. In particular, this is due to accelerating demand growth ex-China and supply constraints. He believes that this cycle is in very early stages as key demand drivers, such as pent up consumer demand, accelerating global capex and massive stimulus in the US, have yet to fully kick in. He called out copper in particular, as believes demand growth in China will be slow over the next ten years relative to the last decade, but expects demand in the rest of the world to strongly increase after having fallen over. Our top pick with leverage to copper remains Freeport MacMoRan.
The Jefferies price target for the shares is $55, well above the Wall Street consensus target of $39.29. Freeport-McMoRan stock popped almost 5% on Friday to close at $43.97 a share.
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