Concerned investors should stock their portfolios with stocks that have the best chance of weathering market volatility and represent good long-term buying opportunities, analysts said this week. These companies have certain characteristics that Wall Street analysts believe will allow them to emerge on the other side of the turmoil. CNBC Pro scoured the best Wall Street research to find some top stocks to buy for the long term. These include ServiceNow, Pinterest, Wheels Up, Victoria’s Secret, and Coinbase. Pinterest Shares of Pinterest have fallen 75% over the past year, but investment firm Loop Capital says not to give up on the stock just yet. “While signals are mixed and advertisers are more cautious, our reviews so far show little evidence of a meaningful and broad-based pullback,” wrote analyst Rob Sanderson. Some short-term headwinds are to be expected, the analyst said, particularly after social media giant Snap warned in late May that it would miss certain earnings targets for the quarter. “Although macro concerns remain elevated, we think near-term expectations are reasonable,” Sanderson added. Still, Sanderson said investors should buy Pinterest stock. The company sees several positive catalysts that investors may not be aware of. For example, Sanderson is optimistic about Pinterest’s push to shop on its platform. He called it an undefined but “meaningful” opportunity. “Shopping activity and GMV (gross margin value) have expanded significantly in the three years since the IPO,” he continued. Idea Pins, which allow users to create short story-like video sequence clips, has dragged down revenue growth, but Sanderson sees long-term benefits. Bottom line, the “long-term opportunity remains promising,” he wrote. Coinbase Bitcoin continues to take investors on a wild ride, crashing more than 20% to around $20,500 over the past week. Meanwhile, shares of crypto company Coinbase are also down almost 80% this year. But JMP analyst Devin Ryan says that despite the volatility, there’s still a lot to like about the stock. The company says that Coinbase is very “well positioned to weather a very challenging moment in the market” and even gain shares from smaller competitors. “We believe crypto adoption will be tested but not broken,” he said. Ryan reminded investors that Coinbase really is an exchange with an excellent balance sheet and almost no lending. Coinbase is one of the “best houses on the block at an uncertain time,” he wrote. Not every digital company will survive, Ryan acknowledged, but Coinbase represents a “long-term opportunity for strong companies to gain share and further differentiate themselves,” he added. In his view, the analyst said that macro factors are really to blame for the recent crypto sell-off. “Ultimately, the current environment underscores the value of companies that can provide safety and resilience in challenging market conditions,” Ryan wrote. Coinbase is the right stock at the right time, the company said. Wheels Up Goldman Sachs is adding to the shares of the private aviation company. The company began coverage on the stock earlier this week with a buy rating and a price target of $5 per share. Demand for Wheels Up services remains robust, and analyst Noah Poponak called the overall addressable market “significant.” “The pandemic has proven to be a catalyst for the accelerated adoption of private travel, and as Wheels Up scales its business model and capitalizes on technological efficiencies, it can unlock even more demand through intelligent supply and dynamic pricing,” he wrote. However, investors need to remain patient and overlook near-term headwinds, the analyst said. Shares are down nearly 44% this year, and Poponak sees an “attractive entry point.” “The business has significant upside potential to normalized margins and cash flows that aren’t that far off,” he said. The market is unnecessarily skeptical about the long-term adoption of private jets, the company added. “Great long-term opportunity,” exclaimed Poponak. Victoria’s Secret – Jefferies, Buy Review “VSCO is on the path to recovery with increasing sales momentum and improving brand sentiment. While the company’s initiatives are working, the near-term top-line trends are being partially pressured by supply chain headwinds, which may obscure underlying brand recovery efforts. While we do not expect a linear recovery, we believe VSCO’s long-term opportunity remains flat and we believe VSCO has the ability to recover lost sales while regaining margins.” Pinterest Loop, Purchase Rating “Long-term opportunity remains bright. … .While signals are mixed and advertisers are hesitant, our reviews so far show little evidence of a meaningful and broad-based pullback…. While signals are mixed and advertisers are more cautious, our reviews so far show little evidence of a significant and broad-based pullback…. While macro concerns remain elevated, we think near-term expectations are reasonable….Shopping activity and GMV have expanded significantly in the three years since the IPO.” ServiceNow – Deutsche Bank, Buy rating “We attended the Kn owledge 2022 and ServiceNow Financial Analyst Day in Las Vegas and feel good about the company’s long-term opportunity and relative strength in a challenging environment. With several software companies showing early signs of macro deterioration, ServiceNow is holding up strong so far, which appears to be the result of multiple forces.” Wheels Up – Goldman Sachs, Purchase Review “Significant TAM Opportunity. …. The pandemic has acted as a catalyst for accelerated adoption from private travel, and as Wheels Up scales its business model and capitalizes on technological efficiencies, it can capture even more demand through intelligent supply and dynamic pricing….The business has significant potential for expansion to normalized margins and cash flows not far away are. … .Great long-term opportunity.” Coinbase- JMP, Market Outperform Rating We believe crypto adoption will be tested but not broken. ….these moments represent a long-term opportunity for strong companies to gain market share and further differentiate themselves from the crowd. Confidence in the platform is still required to support an investment in COIN stock, but we find that the company is incredibly liquid in an uncertain time and is one of the best houses on the block, and we currently believe that COIN is well positioned to weather a very challenging moment in the market & potentially even take market share from weaker competitors who are ill prepared for a market downturn. … .Ultimately, the current environment underscores the value of companies that can offer security and solidity in difficult market conditions.”
