Wake Up To Wealth: 7 Sleeper Stocks Ready To Roar

The morning coffee could kick in soon

• Teradyne (TER): Teradyne offers growth potential in the semiconductor equipment sector, consistently surpassing earnings expectations despite its under-the-radar status.
• Cognex (CGNX): Cognex provides machine vision products with utility across various industries, showing strong financial performance despite limited market attention.
• MasTec (MTZ): MasTec delivers engineering and construction services, demonstrating resilience and growth potential in the communications and infrastructure sectors.
• These sleeper stocks could be poised to start the day right.

With the equities market continuing to march higher, now may be an ideal time to consider sleeper stocks. Essentially, these are companies that attract little interest among investors. However, once more people recognize the underlying bullish narratives, they could fly higher.

In this day and age of the 24/7 news cycle combined with social media, it may seem strange that sleeper stocks even exist. However, the U.S. equities space features thousands of opportunities. Combined with top-tier international offerings, it’s inevitable that some ideas will fail to capture the spotlight.

Plus, the market isn’t a democracy. When hot ideas scream higher, they tend to attract the lion’s share of the attention. However, that also leaves open the prospect of hidden gems that are ready to soar. With that, below are compelling ideas for sleeper stocks to buy.

Teradyne (TER)

A technology firm, Teradyne (NASDAQ:TER) falls under the semiconductor equipment and materials subcategory. Per its public profile, the company designs develops, manufactures, and sells automated test systems and robotics products worldwide. It operates through four segments: Semiconductor Test, System Test, Robotics, and Wireless Test. Since the start of the year, TER stock gained a bit over 3%.

While it doesn’t receive anywhere near the attention of other popular semiconductor investments, this lack of interest makes Teradyne an ideal opportunity among sleeper stocks. For example, the company consistently beat its estimate for earnings per share last fiscal year. Indeed, the average positive earnings surprise in the last four quarters came out to 17.13%.

For fiscal 2024, experts believe EPS will land again at $2.93 on revenue of $2.73 billion. While that’s a modest growth of 2.2% from 2023’s tally, analysts also believe that 2025 could yield sales of $3.35 billion.

Right now, TER features a moderate buy consensus view with a $111.69 average price target. However, the high-side estimate of $130 may be a likelier target given the projected 2025 sales bump.

Cognex (CGNX)

Another example of sleeper stocks listed under the tech ecosystem, Cognex (NASDAQ:CGNX) falls under the subcategory of scientific and technical instruments. Per its corporate profile, the company provides machine vision products that capture and analyze visual information to automate manufacturing and distribution tasks worldwide. The vision systems offer much utility across multiple industries, including mobile phones, electric vehicle batteries, and e-commerce-related supply chains.

Interestingly, CGNX stock is a slow mover, gaining only 2.5% since the beginning of this year. In the past 52 weeks, it’s down over 13%. That seems awfully ungenerous given the financial performance. Last fiscal year, it handily beat EPS targets. In the past four quarters, the average positive earnings surprise clocked in at 20.75%.

For the current fiscal year, experts believe that EPS will land at 78 cents on revenue of $933.73 million. Last year, Cognex posted per-share profits of 73 cents on sales of $837.55 million. Analysts peg shares a moderate buy with a $44.50 price target, implying about 8% growth potential.

MasTec (MTZ)

Falling under the industrials sector, MasTec (NYSE:MTZ) operates within the engineering and construction subcategory. According to its public profile, MasTec provides engineering, building, installation, maintenance and upgrade services for multiple industries. Primarily, we’re talking about the communications space. As well, the company serves the energy and utility arenas as well as other infrastructure categories.

Among sleeper stocks, MTZ is one of the best performing, having gained almost 24% since the start of the year. However, in the past 52 weeks, it’s still down about 3%. It’s possible, then, that there could still be some extra growth to extract. Financially, the company is generally reliable. However, it had a bad miss in the third quarter last year. Still, MasTec came back strong in Q4.

For the current fiscal year, analysts anticipate EPS of $2.69 on sales of $12.53 billion. That’s an improvement over last year’s print of $1.97 on sales of $12 billion. Even better, experts see fiscal 2025 revenue reaching $13.5 billion.

Analysts rate MTZ a strong buy with a $98.92 price target. The high-side estimate lands at $106.

Gildan Activewear (GIL)

Listed under the consumer cyclical ecosystem, Gildan Activewear (NYSE:GIL) operates within the apparel manufacturing realm. From its corporate profile, Gildan manufactures and sells various apparel products in North America, Latin America, Europe, and Asia-Pacific. The company offers athletic wear, such as T-shirts, fleece tops, and sports shirts. While it may be a crowded market, GIL stock has managed to pop up 13% on a year-to-date basis.

Financially, Gildan could be worth a look as one of the sleeper stocks on a gradual comeback trail. In Q1 2023, the company suffered a negative earnings surprise of 13.5%. However, it beat estimates from Q2 through Q4, generating an average beat of 3.4%. It’s not groundbreaking but then again, Gildan is operating in a tight space amid troubles for the consumer discretionary market.

For fiscal 2024, experts believe Gildan will post EPS of $2.95 on sales of $3.26 billion. That’s a modest improvement over last year’s print of $2.57 per share on revenue of $3.2 billion. For fiscal 2025, the top line may reach $3.39 billion.

Analysts peg shares a moderate buy with a $40.19 average price target, implying almost 10% upside.

Welltower (WELL)

Structured as a real estate investment trust (or REIT), Welltower (NYSE:WELL) falls under the subcategory of healthcare facilities. Per its public profile, Welltower invests with leading senior housing operators, post-acute providers, and health systems to fund the real estate and infrastructure needed to scale innovative care delivery models and improve people’s wellness and overall healthcare experience.

WELL arguably makes a strong case for sleeper stocks because of the powerful demographic catalyst. With millions of baby boomers set to retire over the next several years, care facilities will likely rise in demand. To be fair, Welltower has incurred a choppy financial performance, beating bottom-line targets in Q2 and Q3 and missing them in Q1 and Q4.

Still, the long-term narrative may be what matters. For fiscal 2024, experts anticipate EPS to land at $1.27 on sales of $7.46 billion. In contrast, 2023’s print was 66 cents per share on revenue of $6.64 billion.

Analysts rate WELL a consensus moderate buy with a $99.21 price target, implying 9% upside potential.

Appian (APPN)

Another candidate for sleeper stocks in the tech space, Appian (NASDAQ:APPN) falls under the software-infrastructure subcategory. According to its public profile, Appian is a software company that provides low-code design platform in the U.S., Mexico, Portugal and internationally. Notably, the company’s platform offers artificial intelligence, process automation, data fabric and process mining.

Since the start of the year, AAPN stock gained over 7%. However, in the past 52 weeks, it slipped slightly more than 7%. Although the company is a slow mover in the charts, Appian has been a tremendous performer recently. In Q4 2023, the software firm posted an EPS of 6 cents against an expected target of a loss of 24 cents per share.

Overall, the average positive earnings surprise in fiscal 2023 came out to nearly 40%. For fiscal 2024, experts believe Appian will post a per-share loss of 69 cents on revenue of $615.64 million. Last year, the company incurred a loss of 81 cents per share on sales of $545.36 million.

Analysts peg shares a moderate buy with a $43.33 average price target.

Curaleaf (CURLF)

While Curaleaf (OTCMKTS:CURLF) falls under the healthcare space, let’s be real: it’s a cannabis operator. Per its corporate profile, the company operates through two segments, Domestic Operations and International Operations. Curaleaf offers multiple products, including flower, pre-rolls, dry-herb vaporizer cartridges, among others. Since the start of the year, CURLF gained almost 26% of equity value.

With such an outsized performance, it’s difficult to call Curaleaf an outright candidate for sleeper stocks. However, it’s relatively away from the spotlight compared to the top-tier cannabis players. To be sure, though, Curaleaf suffers from poor results. The negative surprise in the past four quarters is 89%, which is eye-opening (in a bad way).

For fiscal 2024, analysts believe that the company will post a per-share loss of 18 cents on sales of $1.42 billion. Last year, Curaleaf posted a loss per share of 39 cents on revenue of $1.35 billion.

Finally, covering experts rate CURLF a consensus strong buy with a $5.44 price target. The high-side estimate calls for $7.

This post originally appeared at InvestorPlace.

On the date of publication, Josh Enomoto did not have (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.

Category: Stocks