Why Ethereum Keeps Soaring High

Why Ethereum Keeps Soaring High

TipRanks

In stock investing, the game is all about returns. At the end of the day, every investor wants to see the portfolio choices pay off, and bring a return on the investment. A wise investor looks to balance risk against the return. In today’s environment, with markets generally up – the S&P 500 has gained 12% so far this year – the main risk for now takes the form of ‘local’ losses; that is, short term slips in a rising stock environment. To cover that risk, investors need to remember the other truth about the stock market: it’s a long-term play. Don’t expect to realize huge gains quickly, stay in for the long haul, and look for stocks that offer high return potential. That’s the key to investing success. Using the TipRanks platform, we’ve located three stocks that offer investors a 40% or better upside for the year ahead, along with a Strong Buy consensus rating. They come from a range of stock sectors, have shown individual quirks in their recent share performance – and some of Wall Street’s top analysts have given them the thumbs up. Let’s find out why. Tenable Holdings, Inc. (TENB) We’ll start in the tech sector, where Tenable is a holding firm that bills itself as ‘the cyber exposure company.’ Tenable’s flagship product, Nessus, is a vulnerability scanner that allows users to find and close vulnerabilities in their networked systems. Along with its other products, Tenable’s line of exposure protection software gives customers a threefold advantage: to see, predict, and act. The product line is popular, and Tenable boasts over 30,000 organizations in its customer base, including more than half of the Fortune 500 companies. Along with a large customer base and a product line that is growing indispensable in the digital world, Tenable has featured steady financial growth. The company has registered quarter-over-quarter revenue gains for the past nine quarters, and shows no sign of stopping. In the most recent reported, 1Q21, Tenable reported $123.2 million at the top line, up 4% sequentially – but 20% year-over-year. In other key metrics, Tenable reported $38.6 million in cash from operations, of which $37.6 million was free cash flow – an impressive 97% of the company’s cash flow. FCF was up a whopping 864% year-over-year. Tenable also reported more than 330 new enterprise platform customers in the quarter, 29 new customers with net contracts in the six-figure range. Tenable has attracted attention from Daniel Ives, Wedbush’s tech expert rated in the top 1% of Wall Street’s analysts by TipRanks. Ives writes of Tenable, “TENB came out of the gates swinging in the March quarter as the company posted impressive revenue/billings upside along with stronger than expected guidance… We continue to view Tenable as one of our favorite cyber security names as the company’s expanded product portfolio, cloud strategic focus, high caliber management team, and risk/reward is very compelling at current levels.” Ives gives TENB shares an Outperform (i.e., a Buy) rating, along with a $62 price target that implies a one-year upside of 68%. (To watch Ives’ track record, click here.) From the Strong Buy consensus rating, it’s clear that Wall Street generally agrees with Ives. The stock’s 6 recent reviews break down 5 to 1 in favor of Buy versus Hold. Shares are priced at $36.88 and the $57.50 average price target suggests an upside of 56% in the next 12 months. (See Tenable’s stock analysis at TipRanks.) Trulieve Cannabis (TCNNF) Let’s shift gears, and look at the cannabis industry. Cannabis has, in the last decade, gone from being an illegal controlled substance to a big business, as major countries like Canada and Germany (for medical use only) have legalized the drug, along with more than 30 US states that have full or partial legalization. As the drug has grown more accepted – and its medical use has become more mainstream – a whole network of cannabis providers has grown up to meet the demand. Trulieve is one of the big players in the US medical cannabis sector. Since the drug is still illegal at the US Federal level, medical cannabis companies in the States must operate on a state-by-state basis. Trulieve has taken a leading position in the Florida market for medical cannabis, where the company boasts a 51% market share in the nation’s third largest state – and the second largest state with legal medical use. Trulieve also operates in California, Massachusetts, Connecticut, and Pennsylvania, boasts over 550 individual items in its product line, and offers a vertically integrated ‘seed-to-sale’ business model. While the medical cannabis business in the US has to adapt to a wide range of legality regimes, preventing operations on a truly national scale, Trulieve has met the challenge and seen three years in a row of profitability. In the company’s most recent financial release, for 4Q20, the top line came in at $168.4 million, up 24% year-over-year to reach a company record. For the full year, revenues were $521.5 million, up 106% yoy. The company saw full-year net income of $63 million, up 19% from 2019, and $99.6 million in cash from operations. Matt McGinley, 5-star analyst from Needham, likes Trulieve’s prospects going forward. He writes, “We expect FL to be 80%+ of Trulieve’s revenue in ‘21, but new states should comprise 33% of growth. We think Trulieve’s balance sheet is in a strong position to accelerate the pace of M&A, and to concurrently sustain higher levels of capex…. We believe that the stock will rate higher on EBITDA growth, and believe the multiple is low for a company with such strong operating fundamentals.” The analyst’s comments back up his Buy rating on the stock, and his $60.75 average price target indicates confidence in 46% share growth for the year ahead. (To watch McGinley’s track record, click here.) With 9 Buy recommendations on record, the Strong Buy consensus rating on TCNNF shares is unanimous. The stock is trading for $41.37 and has an average price target of $69.61, suggesting an upside of 68% in 2021. (See Trulieve’s stock analysis at TipRanks.) Snap, Inc. (SNAP) Last up, Snap, is best known as the parent company of the popular Snapchat app. Along with Snapchat, Snap also owns Bitmoji and markets the Spectacles smartglasses. The common theme is the combination of social media and camera apps, letting users play with photo filters, create temporary stories, and record videos. Snap bills itself as a camera company, that uses social tech to reinvent personal photography. Snap reported its 1Q21 earnings last month, and saw revenue rise 66% year-over-year, coming in at $770 million for the quarter. Free cash flow hit $126 million, up $131 million from the year-ago quarter. This was the company’s first positive free cash flow print since going public in 2017. The solid financial display is underpinned by strong user growth. The DAU – daily active user – number grew 22% yoy, to a total of 280 million. The company divides its operations into North America, Europe, and Rest of World – and DAU was up in all three, both sequentially and year-over-year. This was the first quarter in which Snap’s Android users made up a majority of the DAUs. SNAP shares are covered for Wells Fargo by analyst Brian Fitzgerald, who is rated #9 overall by TipRanks. Fitzgerald sees the stock with plenty of potential going forward, saying of it: “[We] remain bullish given strong usage/engagement trends and ample monetization runway across an array of dimensions (increasing ad relevance, new formats, increasing AR adoption, increasing share of e-commerce and gaming activity on platform, and narrowing the domestic/int’l monetization gap)…. we view shares as attractively valued at current levels given SNAP’s large and highly engaged audience, improved audience growth, rapid revenue growth and improving profitability profile.” Along with these comments, Fitzgerald gives SNAP an Overweight (i.e., Buy) rating, and a $91 price target to indicate room for 68% upside in the next 12 months. (To watch Fitzgerald’s track record, click here.) In recent weeks, Snap has picked up 36 analyst reviews. These include 29 to Buy, overbalancing the 6 Holds and 1 Sell, and giving the stock a Strong Buy consensus rating. SNAP sells for $55.78, and at $80.13 its average price target suggests a one-year upside of 43%. (See Snap’s stock analysis at TipRanks.) To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights. Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.

Ethereum ‘yet to take off’ and is on track for $5,200 soon, say experts - CityAM

Ethereum’s startling run through $3,000 and above is far from over and could see Bitcoin’s main rival surpass $5,000 before long, according to expert analysts.

Ether, the native cryptocurrency for Ethereum and the second-largest digital asset by market cap, broke the $3,000 threshold earlier this week as it more than doubled its 2017 all-time high.

Yesterday, Vitalik Buterin’s brainchild reached up and planted a kiss on the cheek of $3,500 before gravity saw it slip down to $3,235. Today, it crawled back up to take a breather on a ledge of support around $3,360.

Many traders will no doubt be expecting ETH to hold track for a while and consolidate before making any determined effort to return to yesterday’s levels, and historical patterns would favour this notion.

However, experts at global exchange Kraken have a far more bullish narrative on the coin that could, one day, challenge Bitcoin’s 12-year dominance of cryptocurrency.

In its latest Market Recap Report, analysis by Kraken Intelligence suggests the ETH rally may still be in the early innings. They report that, even with the most-recent price appreciation, Ether dominance – its share of the total crypto market cap – is only coming close to the 18 per cent multi-year high achieved in mid-February, but remains far away from the +30 per cent achieved at the height of the 2017 rally.

Multi-billion dollar explosion

“The multi-billion dollar explosion in DeFi and this year’s NFT frenzy took place on applications built on Ethereum,” said Pete Humiston, Manager of Kraken Intelligence.

“Past performance does not indicate future prices, but the fact that Ethereum remains resolutely at the heart of bleeding-edge activity and innovation in the industry – just as it did in the previous bull market – suggests ETH has plenty of upside potential.

“With Ether held on exchanges at a 2.5-year low, and institutions warming up to the second largest crypto asset, as well as market participants having locked up more than four million ETH – 600k on Kraken’s secure on-chain staking service alone – ahead of the launch of Ethereum 2.0, the stars are aligning for another significant leg up for the ETH price.”

On page 17 of its 22-page dossier, the report charts “ETH: The Road to $5,200”, and uses a logarithmic regression graph to highlight potential future positions for Ethereum.

“As difficult as it will be for ETH to sustain double digit returns, the case could also be made that ETH still has plenty of upside,” the accompanying notes state.

“Since hitting a multi-year high of ~18 per cent around mid-February, ETH’s dominance has mean reverted down to 12 per cent and had largely trended sideways.

“The fact that ETH continues to climb higher while retaining the same market share suggests that ETH has yet to take off.”

Mark Cuban: The 3 ways Ethereum ‘dwarfs’ bitcoin

Ether, the cryptocurrency that runs on the Ethereum blockchain, hit a record high on Tuesday.

Though it is still second behind bitcoin in market value, there is growing excitement surrounding Ethereum and its capabilities.

According to billionaire investor Mark Cuban, “the number of transactions and the diversity of transaction types along with the development efforts in Ethereum dwarf bitcoin,” he tells CNBC Make It. “The utilization of Ethereum is much higher.”

First, the Ethereum blockchain consistently processes more transactions per second than bitcoin’s, making payments faster and more productive.

Second, it can support the creation of applications. Ethereum is known for its smart contracts, which power and build decentralized applications, like DeFi (or decentralized finance) apps, and NFTs (nonfungible tokens).

“Right now, bitcoin is a more established store of value and there is no reason to think it won’t continue to be for a long time,” Cuban says. “Ethereum, on the other hand, is booming with development that I think will create so many new applications.”

Third, Cuban says that as an upgrade to the Ethereum blockchain called Ethereum 2.0, which launched in 2020, continues to roll out, “the impact of Ethereum could be greater than we currently imagine.”

Investors agree that there are several benefits to Ethereum 2.0. First, it could make Ethereum even faster — investors say the changes could allow several thousand more transactions per second on the blockchain, as CNBC reported. They also say it could be more secure, among other things, “all of which will be hugely positive as a whole for Ethereum,” Cuban says.

The only “challenge with Ethereum as an investment” is that until its update is complete, it’s difficult to predict which improvements will come to light and which will not, Cuban says, which can “create some confusion along the way.”

Though he is overall bullish on both Ethereum and bitcoin, Cuban also notes that new entrants to the market can always disrupt the status quo.

“Just like all major tech companies are at risk of new technologies superseding them, there is always the risk of a better decentralized chain coming along to disrupt bitcoin and Ethereum,” he says.

Billionaire investor Ray Dalio, founder of hedge fund Bridgewater Associates, said similar in a January post titled “What I Think of Bitcoin.”

“I presume that a better alternative will be invented and pass it by,” Dalio wrote, “because that is the way the evolution of everything works.”

In Cuban’s opinion, it’s “not likely. But always possible,” he says.

Cuban has been at the forefront of the wave of interest in cryptocurrencies and the technology that surrounds it. He has a portfolio of bitcoin, Ethereum and other digital coins himself, and has invested in many companies in the space.

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