Throughout the course of this tumultuous year, TipRanks tracked and measured the performance of 132,853 ratings published by Wall Street analysts.
Despite a strong year for the market, TipRanks found that the yearly return of an average Buy/Sell rating issued by an analyst landed at 9.9%, below the S&P 500's 14.3% year-to-date gain.
That said, the 25 best performing analysts achieved a success rate, or the number of profitable recommendations measured over a three-month holding period, of 69%, with their average returns per rating coming in at 30.8%.
To this end, TipRanks compiled a list of 2020's top five analysts by success rate and average return per rating, in addition to their most profitable stock recommendation.
Here are the results:
Oppenheimer, Colin Rusch
As the roller coaster ride that was 2020 comes to an end, investors are wondering where the market goes from here. 2020 saw a global pandemic claim over a million lives and the resulting lockdowns send the U.S. economy into a recession, with unemployment rates surpassing levels witnessed during the Great Recession.
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Amid the health crisis, cities throughout the U.S. faced protests that broke out in response to police violence. If that wasn't enough, 2020 bore witness to a highly contentious U.S. presidential election, in which Joe Biden ultimately defeated incumbent Donald Trump.
However, against this backdrop, stocks rebounded remarkably off of March lows, with the major U.S. stock indexes breaking record after record, in a display of sheer disconnect.
Many on Wall Street have pointed to the Federal Reserve's swift action to mitigate the economic damage related to the pandemic, which included cutting interest rates to near zero, new quantitative easing measures and loans, as propping stocks up during this period.
Earning the title of 2020's best-performing analyst, Colin Rusch has built an impressive career in the industrial efficiency and cleantech spaces. Starting off as an equity research associate at Piper Jaffray, he has also worked for Broadpoint Capital, ThinkEquity, Ardsley Partners and Northland Capital.
Rusch came on board at Oppenheimer in 2015 and currently serves as managing director and senior analyst, with the Wesleyan University graduate also in charge of the firm's sustainable growth and resource optimization franchise.
Over the past year, Rusch has achieved an 81% success rate, with his ratings, on average, generating a return of 39.9%.
When it comes to his most profitable rating in 2020, Rusch's Buy rating on Sunrun (RUN) delivered the highest return. From May 7 to Aug. 7, the company soared 233%.
Following Sunrun's strong third quarter performance, in which it posted beats on both the top and bottom lines, Rusch remains optimistic about the solar panel company.
"We understand RUN does not need to move into new geographies to hit its deployment goals and that it is seeing a building group of potential partners that may accelerate RUN's customer acquisition cadence. We also expect RUN to benefit from low-cost capital availability, notably asset backed debt, which is beginning to approach 2%," the analyst commented.
Going forward, Rusch will be paying close attention to the Vivint Solar integration, as operating expense leverage is a key component of his free cash flow estimates.
In addition to reiterating a bullish call, Rusch lifted the price target from $55 to $65. That said, at current levels, this target indicates possible downside of 1.8%.
Oppenheimer, Brian Nagel
Taking the second spot on TipRanks' list, Brian Nagel has over 20 years of experience covering the retail and consumer growth sectors.
Nagel started his career as an analyst at Credit Suisse, before moving to UBS where he advanced from associate director to director to executive director over the course of four years. In 2009, he joined Oppenheimer, currently serving as managing director and senior analyst covering the consumer growth and e-commerce sectors for the firm.
Nagel has the track record to back up his ranking, boasting a 78% success rate for 2020. On top of this, his calls saw a return of 37.5%, on average.
So, what was Nagel's best recommendation from the past year? His buy rating on furniture retailer Lovesac (LOVE). In the period from April 2-July 2, the stock posted returns of a whopping 521.1%.
The "Sactionals" maker announced in November its online launch with Best Buy, with Nagel looking "very favorably upon efforts on the part of LOVE to broaden further its strategic relationship with BBY and extend the company's digital reach."
Expounding on this, Nagel stated, "Over the past several years, BBY has aggressively reconfigured its business model and transitioned from a leading stores-based business to one of the most powerful digitally enabled omni-channel chains in specialty retail … As we have indicated, we look upon LOVE and the company's innovative product set as well-positioned to capture share within the largely tired home furnishings segment."
In line with his optimistic approach, Nagel reiterated a buy rating and a $40 price target. However, with shares up almost 43% in the last month, the analyst's target implies downside potential of 5%.
H.C. Wainwright, Vernon Bernardino
2020's third best-performing analyst is H.C. Wainwright managing director and senior healthcare analyst Vernon Bernardino.
Before his career on Wall Street kicked off, Bernardino worked as a scientist researching cardiovascular diseases, with this work resulting in the discovery and development of Zetia, a therapy designed to reduce cholesterol. The drug boasts over $2 billion in annual sales.
From then, Bernardino went on to serve as a healthcare equity research analyst at several investment firms including Seaport Global Securities, B. Riley FBR, Rodman & Renshaw, UBS Securities and Nicholas Applegate Capital Management, which is now part of Allianz SE, before tackling his current role at H.C. Wainwright in 2018.
Looking at Bernardino's performance over the past year, it's clear that he more than earns his spot on TipRanks' ranking. On average, the analyst's calls returned 57.3% during the last year, the highest among this group of top analysts. As for the success rate, it comes out to 48%.
Out of all Bernardino's recommendations, his Novavax (NVAX) buy rating notched the largest return, with the figure landing at more than 708% during the period of April 30-July 30.
Although the biotech is behind Moderna and Pfizer in the COVID-19 vaccine race, Bernardino still has high hopes for NVAX, arguing, "Novavax's methodical and careful advancement of NVX-CoV2373 is a winning strategy capable of withstanding critical regulatory review and gaining the vaccine's EUA in 1H21."
Pointing to its ongoing Phase 2b trial in South Africa evaluating its COVID-19 vaccine candidate, Bernardino highlights that the trial includes HIV-positive patients, increasing the amount of data from racially and geographically diverse populations adults.
"We believe this part of Novavax' COVID-19 program, as well as its collaborations with key strategic regional players in Asia, bolsters our view that the company is very competitive versus much larger COVID-19 vaccine players, and has a comprehensive global vaccine distribution plan that remains underappreciated," he explained.
It should come as no surprise, then, that Bernardino kept a buy rating and $207 price target on the stock, suggesting 67% upside potential.
RBC, Matthew Hedberg
Claiming the fourth position on TipRanks' list, we have Matthew Hedberg, who focuses on the software industry and primarily covers infrastructure, security and big data-related companies. Along with his over 14 years of experience at RBC, TipRanks' best-rated research firm, Hedberg brings eight years of experience in the software space to the table, working with the likes of Accenture and GMAC.
During 2020, Hedberg saw his success rate reach 74%. What's more, the average return generated by his ratings comes in at a respectable 24.2%.
While his overall performance in 2020 was impressive, to say the least, one call in particular stands out. Between March 16-June 16 of this year, his buy rating on CrowdStrike (CRWD) generated a 206% return.
Calling the cyber security company a "favorite growth idea," Hedberg sees its long-term growth narrative as being strong following its Q3 earnings release. CRWD reported organic ARR of $900.6 million, reflecting a gain of over 80% and beating the Street's $853.8 million estimate. This was driven by its addition of a record $110 million in organic new ARR. To top it all off, free cash flow landed at $76.1 million.
It should be noted that the results weren't overly impacted by larger deals, with it "well balanced" on a product and geographic basis. Additionally, management increased its FY/21 revenue guidance by more than the Q3/21 revenue beat.
"Results continue to show the importance of security transformation being a precursor to digital transformations … CrowdStrike continues to see positive tailwinds from security transformations, which are often a precursor to digital transformation and why we think growth will remain durable," Hedberg stated.
All of this prompted Hedberg to assign a buy rating with a price target of $200. Given the 337% year-to-date jump, the price target indicates 5% downside potential.
Northland Capital , Greg Gibas
Snagging the final spot on TipRanks' list is Greg Gibas.
The senior research analyst from Northland Capital joined the firm in 2015 and has since covered multiple areas of the market including the enterprise software /SaaS, communications technology, cannabis, connectivity and satellite services, media & internet, real estate and industrial sectors. Previously, Gibas worked as an analyst covering both quantitative and qualitative projects.
Supporting his top 5 ranking, Gibas achieved a 77% success rate in 2020. Even more noteworthy, his recommendations generated a 45.4% return, on average.
Topping his list of most profitable calls is his buy rating on Daseke (DSKE), the largest owner and operator of open deck equipment and second largest provider of open deck transportation and logistics in North America. In the three-month period starting from May 8, shares climbed over 248% higher.
According to Gibas, the company "just keeps truckin' on," as evidenced by its most recent quarterly performance.
During the third quarter, its top line improved substantially, with DSKE also able to deliver continued operational strength amid a challenging macro environment. On top of this, along with strength in niche markets like wind energy and high security cargo, management indicated that overall freight demand improved following the lows seen in April.
"We continue to appreciate DSKE's end market diversification and noticeable operating ratio improvement despite the difficult industrial market backdrop … We continue to have confidence in DSKE's ability to successfully execute on both an operational and financial level and like that its near term focus is both on strategic integration as well as reducing balance sheet leverage," Gibas commented.
Bearing this in mind, Gibas lifted the price target to $8.50 (43% upside potential) from $7.25 and maintained a Buy rating.
TipRanks evaluates public stock recommendations made by financial analysts and financial bloggers, then ranks those experts based on their accuracy and performance.