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LivestreamMenuBank of America says there are several stocks offering plenty of upside in September. The investment bank says companies including Tapestry are firing on all cylinders. Other buy-rated names screened by CNBC Pro include: Madison Square Garden Entertainment, ASML and Church & Dwight. Madison Square Garden Entertainment The owner of the New York Knicks and Rangers is firing on all cylinders, according to the bank. Analysts led by Peter Henderson see plenty more room for the stock to run following its recently quarterly report. “Results were led by robust Garden concert activity as concert revenue benefited from both more shows & higher per-concert economics, while F4Q also benefited from the Knicks championship run, and higher sponsorship/signage & suite revenue,” he wrote. Henderson also likes the Garden’s coming schedule of bookings, which remains robust. “Healthy operating leverage should drive margin expansion, leading to strong [adjusted operating income] growth,” he said. Madison Square Garden Entertainment shares are up 45% this year. Church & Dwight Analyst Anna Lizzul said in a recent note to clients that Church & Dwight management is pulling all the right levers in its turnaround. The bank said that the maker of Arm & Hammer baking soda, toothpaste and shampoo finally has the right mix of value products to go along with premium. “We see tailwinds from growing power brands through innovation with benefits from portfolio reshaping to fuel CHD to a higher base level of gross margin the company has not achieved in its history,” she wrote. Lizzul also said Church & Dwight has a history of outperforming in a tough macroeconomic environment and that the stock remains a top idea, and applauded a “new and improved Church & Dwight.” The stock is up 21% this year. ASML Buy the dip in the maker of semiconductor manufacturing equipment, according to analyst Didier Scemama. The stock is seeing an “unjustified de-rating,” he said recently in urging clients to buy the stock. “The simultaneous de-rating of ASML and re-rating of peers largely explains the stock’s significant underperformance over the past 12 months,” he wrote. Scemama says ASML still has “best-in-class EPS growth supported by margin expansion.” The bank said capacity constraints and rising competition are weighing on ASML, but that the stock remains a top pick. Shares are up 58% this year. Tapestry “We expect consistent strong EPS growth, driven by strong growth at the Coach brand and stabilization at Kate Spade. Solid fundamentals have driven the multiple up near peak levels, so we see limited upside to the stock from here. We expect Tapestry to continue to return capital to shareholders in an accelerated manner given its strong free cash flow generation.” Church & Dwight “A New and Improved Church & Dwight … Improving mix to drive gross margin to new heights … We see tailwinds from growing power brands through innovation with benefits from portfolio reshaping to fuel CHD to a higher base level of gross margin the company has not achieved in its history.” Madison Square Garden Entertainment “Results were led by robust Garden concert activity as concert revenue benefited from both more shows & higher per-concert economics, while F4Q also benefited from the Knicks championship run, and higher sponsorship/signage & suite revenue … Healthy operating leverage should drive margin expansion, leading to strong [adjusted operating income] growth.” ASML “Unjustified de-rating … The simultaneous de-rating of ASML and re-rating of peers largely explains the stock’s significant underperformance over the past 12 months. With our estimates above consensus, we continue to see compelling value and reiterate our Buy rating and €2,452 [price objective]. Best-in-class EPS growth supported by margin expansion.”Read More
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