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CREDIT SUISSE: Everyone else on Wall Street is wrong about these 10 stocks

Published by Business Insider on Mon, 11 Jul 2016


Betting on a stock that no one else likes is risky; so is betting against a stock that's doing well. Butsome of the greatest fortunes have been made by those willing to make contrarian investments in the stock market.In this spirit, Credit Suisse has compiled a list of 10 companies where their analysts stand apart from the consensusview5 stocks that they think are underpriced, and 5 stocks that are overpriced. All represent opportunities that the market hasn't yet priced in.Below are the 10 companies, as well as Credit Suisse's target price and a snippet of their contrarian rationale.AK Steel Holding Corp. Ticker: AKSTarget Price: $7.00Company Description: "AK Steel produces stainless and electrical steel products, primarily for automotive, manufacturing, and construction markets. It operates eight steel plants, two coke plantsand two tube manufacturing plants."Why Credit Suisse sees it differently: "We believe the market is overly focused on AKS's contract exposure (~45% of volumes) and underappreciating the company's exposure to the spot market (30-35%, with varying degrees of lag) given the recent upswing in flat-rolled prices." Kellogg CompanyTicker: KTarget Price: $86.00Company Description: Kellogg Company is an American food manufacturing company, famous for its cereal as well as cookies, crackers, and other snacks.Why Credit Suisse sees it differently: "We believe Kellogg represents the best risk-reward in our space... and we expect the pipeline of new innovation for the Kashi brand and stronger DSD sales for snacks to drive stronger performance as the year progresses."Nationstar Mortgage Holdings Inc.Ticker: NSMTarget Price: $19.00Company Description: Nationstar Mortgage provides residential mortgage loan services in the US.Why Credit Suisse sees it differently: "Investors remain skeptical of NSMs ability to continue to generate profitable returns on its servicing portfolio... [but] NSM has guided 5+ bps of profitability on its servicing portfolio for the full year 2016, and we have them improving from these levels in 2017."See the rest of the story at Business Insider
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