CREDIT SUISSE: Buy these 19 high-conviction stock picks that Wall Street is completely overlooking — including 3 set to surge 40% or more

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It's a challenging time to be a stock picker with both US major indices and equity valuations at all-time highs.

Finding new opportunities in this market can be tricky, especially in today's "buy everything" environment. 

One way to look for hidden outliers is to examine the consensus forecasts amongst analysts.

If an investor is able to spot an investment idea with strong fundamentals and catalysts where the consensus on Wall Street isn't overly bullish, they could see a handsome payout if they're right. 

Thankfully, investors don't need to do all this homework themselves. Credit Suisse just released their third-quarter top investment ideas in a research note on July 22.

The note outlines their top 66 European picks across 28 sub sectors.

Included within the list are the analysts' highest conviction stock picks where Wall Street consensus is not overly bullish.

The analysts call this their "out on a limb" stock list.

"We assess the conviction level of CS analysts for their top Outperform picks by comparing their (i) EPS estimates (FY2) and (ii) target price estimates (12-month rolling) to consensus estimates," Credit Suisse analyst Joelle Anamootoo Natzkoff said in the report. "We measure the level of consensus bullishness by calculating the Net Consensus recommendation balance as: (Number of Buy recommendations – Number of Hold recommendations – Number of Sell recommendations) / Total Number of ratings."

Insider breaks down Credit Suisse's top 19 "out on a limb" European picks, including six stocks set to surge more than 30%. The upside to price target is calculated from prices listed in the July 22 report.

Ticker: AMKAF

Sector: Transportation

Market capitalization: $51.7 billion

Target price: 19,941 Danish krone

Upside to target price: 17%

Difference between consensus target price and Credit Suisse: 7%

Analyst commentary: "We see the scope for the market to ascribe a further $5bn+ in value to Maersk Logistics & Services (~10% of mkt cap) as the company provides more clarity on the value-creation potential of its end-to-end strategy."

Source: Credit Suisse

Ticker: ASOMF

Sector: Retailing

Market capitalization: $5.2 billion

Target price: £72.50

Upside to target price: 58%

Difference between consensus target price and Credit Suisse: 18%

Analyst commentary: "Since the profit warning in 2018, Asos has been very active in rebuilding and much strengthening the management team, the same with the brand and sorting out its international DCs."

Source: Credit Suisse

Ticker: BFFAF

Sector: Materials

Market capitalization: £69.9 billion

Target price: €79

Upside to target price: 22%

Difference between consensus target price and Credit Suisse: 3%

Analyst commentary: "Our benchmarking vs upstream peers suggests on avg. upstream has outperformed by ~€700mn and reverting to historical levels of outperformance could represent an incremental €60m earnings tailwind in FY21."

Source: Credit Suisse

Ticker: BNTGF

Sector: Capital Goods

Market capitalization: $34.3 billion

Target price: €95

Upside to target price: 15%

Difference between consensus target price and Credit Suisse: 15%

Analyst commentary: "We are encouraged by the early realisation of Project Brenntag initiatives (added €15m to operating EBITDA in FY20 with management noting good progress in Q1). Continued site closures, headcount reductions and route optimisations should, in our view, push FY21 operating EBITDA to the top end of the guided range of €1,160m-1,260m (CSe €1,222m)."

Source: Credit Suisse

Ticker: CMPGF

Sector: Consumer services

Market capitalization: $34.3 billion

Target price: £19.50

Upside to target price: 39%

Difference between consensus target price and Credit Suisse: 23%

Analyst commentary: "We like Compass given the potential for the pandemic to accelerate the company's market share growth through the adoption of outsourcing in traditionally cautious sectors, already evidenced by an acceleration in tender activity in Healthcare/Senior Care and Education, where we demonstrate Compass has the best momentum vs. peers."

Source: Credit Suisse

See Also:

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• The CEO of the investment-research firm Fintel shares 3 market sectors where insiders are buying and details how his tool can help retail investors identify opportunities