Recent market headlines are buzzing with worries about sluggish growth and policy uncertainty as the November elections draw near. Nevertheless, there are also potential tailwinds, especially with the anticipated cuts in the Fed’s key interest rates.
Against this backdrop, as always, investors are on the look out to find the stocks that are best positioned for current conditions. The Smart Score, an AI-driven data collection and collation tool from TipRanks, can help with that.
The Smart Score scans the full volume of the stock market’s data, and uses it to compare every public stock to a set of factors that are known to correlate with future outperformance. The result is a simple score for every stock, on a scale of 1 to 10, with the ‘Perfect 10’ indicating stocks with solid upside potential. And in an uncertain market environment, that’s an indicator that investors should give a closer look.
So, let’s do that. Using the TipRanks database, we’ve looked up the big picture on two such top-scoring stocks. The Street sees them as Strong Buys, with plenty of upside – and taken with the ‘Perfect 10s’ from the Smart Score, that’s a combination that deserves closer scrutiny from investors. Here’s the lowdown.
Semtech Corporation (SMTC)
We’ll start with Semtech, one of the smaller firms working in the semiconductor chip industry. Semtech’s product line includes a wide range of analog and mixed-signal chips, capable of powering smaller, faster, and smarter electronic devices. The company offers chips and technology to meet the needs of wireless RF, circuit protection, signal integrity, broadcast video, professional AV, cellular IoT solutions, and power management – a broad range of applications that have a wide impact on today’s digital world.
The company has been in business since 1960 and has built its reputation on being a successful niche player; while Semtech is a small company compared to the industry giants, it still reported more than $868.76 million in revenues for its fiscal year 2024.
More recently, we find that the company saw $215.4 million in revenues during its last reported quarter, fiscal Q2 2024 (July quarter). This was down almost 10% year-over-year, but beat the forecast by $3.13 million. Semtech’s bottom-line earnings came to 11 cents per share by non-GAAP measures, a penny better than had been expected.
Baird analyst Tristan Gerra is impressed by Semtech, and sees the company benefitting from a wide footprint – the company has its hands in many segments of the chip industry. Gerra writes, “Ongoing strength in optical components demand, driven by AI, plays at the core of Semtech’s competencies throughout its product range. Semtech’s R&D team is second to none with the company notably well positioned in ACC with new AI engagements, LPOs (possible ramp for Semtech starting F2H26), and 10G PON in the U.S. (initial ramp engagement possibly F2H26) among others. 400G/800G ramps are complementing Signal Integrity growth this year while the timing of Semtech’s ramp on the Blackwell platform remains intact with potential upside to the previously-provided base case.”
Looking ahead, the analyst puts an Outperform (Buy) rating on SMTC shares, and his $80 price target implies a gain of 97% on the one-year horizon. (To watch Gerra’s track record, click here)
Overall, Semtech’s shares get a Strong Buy consensus rating from the Street, based on 11 recent reviews with a lopsided 10 to 1 breakdown favoring Buy over Hold. The stock is trading for $40.59, and its $56.44 average price target suggests a one-year upside of 39%. (See SMTC stock forecast)
Rubrik, Inc. (RBRK)
Let’s stick with tech, but shift gears a bit and look at cybersecurity. Rubrik is a Silicon Valley tech firm engaged in developing and distributing cloud data management and data security systems, an essential niche in a digital world where more and more aspects of business depend on data and data analysis – and on maintaining the integrity of that data and its sources. Rubrik offers an array of products and solutions for enhanced data security, protecting its customers from cyberattacks, malicious insiders, and external disruptions. Whether your data is on enterprise systems or on the cloud, Rubrik can secure it.
The company’s service is popular, as shown by some of its financial numbers. Rubrik can boast of a high level of annual recurring revenue; the subscription ARR totaled over $919 million at the end of July this year, and the company had 1,969 customers with subscription ARRs of more than $100,000 each. That’s a solid base of repeat business.
Rubrik went public earlier this year, holding its IPO in April. The stock started trading on April 25, and the offering was upsized from the initial filing. In the event, Rubrik put 23,500,000 shares on the market at $32 each, and raised approximately $752 million in gross proceeds. The stock has been volatile in the months since the IPO.
When we look at Rubrik’s financials, we find that the company has released two sets of quarterly results since the IPO. The most recent, released on September 9, covered fiscal Q2 2025 and showed total revenues of $204.95 million. That total was reportedly up more than 35% year-over-year and beat expectations by $8.74 million. The company’s bottom line was a non-GAAP EPS loss of 40 cents per share – but even though the EPS was negative, it was still 9 cents per share better than the forecast.
This new cybersecurity stock has caught the eye of Cantor analyst Yi Fu Lee, who sees the company as a sound choice for investors interested in tech innovators. Lee writes, “The current focus for Rubrik is responsible growth, and we believe it is taking market share from legacy vendors that lag behind on innovation. We recommend investors interested in a mid-cap tech growth name that has recently undergone a cloud transformation to optimize business acceleration for the next several years take a deep look at Rubrik. Rubrik began trading on the NYSE on April 25 and has traded off its peak of $40 by over 20%. We believe the volatile C1H24/F1H25 earnings season for the cybersecurity software sector is presenting an attractive entry point.”
These comments support Lee’s Overweight (Buy) rating here, and his $50 price target points toward a one-year gain of 62.5%. (To watch Lee’s track record, click here)
There are 11 recent analyst reviews on record for Rubrik, and they are all positive – for a unanimous Strong Buy consensus rating. The shares have a $44.90 average price target and a $30.75 trading price, together suggesting a 46% increase by this time next year. (See RBRK stock forecast)
To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a 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.
