The market's rally, fueled by AI stocks, continues to act well, though new buying opportunities are getting tricky to find. A number of artificial intelligence-related stocks posted strong gains this week with Braze and Sprout Social breaking out above buy points. Samsara, UiPath and Shift4 Payments are also among stocks to watch this week as shares eye entry opportunities.
Samsara
IOT stock was the IBD Stock Of The Day for Thursday and is approaching record highs following its December 2021 IPO. The San Francisco-based company provides sensors and cloud-based software to manage vehicle fleets and other physical operations through its Internet of Things platform.
Samsara finally turned a slight profit the past two quarters and averaged nearly 44% revenue growth over the last four quarters.
IOT stock surged more than 3% Friday. Shares on Thursday jumped 5.9% to close at 34.31, decisively clearing the 50-day moving average.
Friday's move topped a trendline and offered early entry at 35.18. Samara stock has a 36.91 buy point from a consolidation above the top of two prior bases that stretch back to June 2023.
IOT stock has a 97 Composite Rating out of a best-possible 99. The Composite Rating combines various technical indicators into one easy-to-read score. Samsara's relative strength line is trending back toward early December highs with a 96 RS Rating.
IOT advanced 5.8% year-to-date.
UiPath
Automation software maker UiPath is a longtime favorite of Cathie Wood, which she has called a top play on artificial intelligence. PATH stock is the top holding of the ARK Innovation ETF and represents the No. 2 holding across all ARK Invest ETFs.
UiPath reported triple-digit earnings growth the last four quarters. meanwhile, revenue growth accelerated the last three quarters to 24% from a 7% gain.
UiPath stock rallied nearly 7% Friday, trading below a 26.52 buy point for an eight-week consolidation and topping its short-term high of 24.40. PATH stock cleared early entries on Thursday and broke a trendline as shares climbed 3.8% during a rebound off its 50-day line.
UiPath has a perfect 99 Composite Rating and an 81 EPS Rating. PATH stock's relative strength line is on the upswing with a 95 RS Rating.
Path shares jumped about 8% in 2024.
Braze
Braze is a member of the IBD 50 list. The software firm offers a customer-relationship platform with an AI-powered chatbot for clients across retail, media, financial services, travel and hospitality industries.
Braze has yet to turn a quarterly profit, but analysts expect that to change on an adjusted basis by Q4. Meanwhile, sales leapt by double digits the last eight quarters, largely driven by subscription revenue.
BRZE stock on Thursday climbed 4% to 58.62, clearing a 57.59 handle buy point in a base-on-base formation. Shares rose another 1.8% Friday pushing further into the buy zone.
Braze has a 94 Composite Rating and a 61 EPS Rating. BRZE stock has a 95 RS Rating as its relative strength line rebounds from short-term lows from early January.
Braze rallied nearly 13% so far this year.
Sprout Social
Chicago-based Sprout Social makes software that manages social media operations for small and medium-size businesses.
Jefferies on Wednesday initiated coverage of SPT stock with a $76 price target and a buy rating. Sprout Social has a market-leading platform and strong partnerships, with favorable secular trends, product expansion opportunities and an increased focus on upselling, which provides the social media manager a runway for over 25% annual growth and $1 billion in revenue by 2028, the firm wrote in a research note.
Sprout on Thursday announced it expanded its partnership with Reddit that will provide clients with deeper real-time data and insights into public conversations, customer activity and brand and industry trends.
Meanwhile, Sprout is capitalizing on the potential of artificial intelligence through its automation and AI offers. Sprout Social's AI products are integrated with OpenAI and capable of providing sentiment and textual analysis, automating manual tasks and suggesting optimized social media posts.
SPT stock on Friday broke out above a 66.42 buy point of a cup-with-handle base as shares jumped about 4.6%. Sprout on Thursday climbed 3.9% after bouncing off its 50-day line to clear a trendline.
SPT stock has an 89 Composite Rating. Sprout Social has a 67 EPS Rating and a 90 RS Rating.
Shares have gained 6% this year.
Shift4 Payments
Digital payments processor Shift4 Payments leads the Finance-Credit Cards/Payment Processors Group according to IBD Stock Checkup.
The stock has been climbing since early November after its Q3 report showed a 123% earnings gain to mark Shift4's second straight quarter of double-digit gains. Revenue growth, however, slowed over the last two quarters to 23% from 36%.
Shift4 Payments on Oct. 26 closed its $575 million acquisition of Finaro, a Pan-European e-commerce platform with banking licenses in Europe, Japan and Hong Kong. A number of firms hoisted their price targets on FOUR stock in early January, including Truist which forecasts 20% organic revenue growth in 2024 with mid-40% organic end-to-end transaction volume growth. Truist hiked its price target to 100 from 75 and kept a buy rating on shares.
FOUR Stock
FOUR stock has been consolidating around top of base, finding support around its 21-day exponential moving average and recently around the 10-week line following a string of tight closes. At Friday's close, the pattern also became a valid flat base pattern with a 78.97 buy point.
FOUR stock's Jan. 29 high of 77.51 offers an entry opportunity, which would be above almost all of the stock's recent trading. Shares are technically actionable at the old 76.40 buy point.
Shift4 Payments has a 98 Composite Rating and an 82 EPS Rating. The stock's relative strength line has climbed off its early November lows and has an 87 RS Rating.
FOUR stock gained 3.5% so far in 2024.
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