Softbank’s (OTC:SFTBY) recent 13F filing revealed that its investment arm has significantly increased its stake in Symbotic (NASDAQ:SYM) and WeWork (NYSE:WE) during the second quarter. While large institutions buying stocks might be seen as a positive indicator, it’s likely best for investors to use more than one parameter to form investment decisions. For instance, savvy investors can use TipRanks’ Experts Center tools to make an informed investment decision.
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With this in mind, let’s check what the future holds for these stocks.
Is Symbotic a Good Stock to Buy?
Symbotic is an automation technology leader. It focuses on the supply-chain segment with its AI- (artificial intelligence) driven robotics and software platform. Thanks to its growing scale, solid revenue growth, and large addressable market, SYM stock has risen by more than 230% year-to-date.
Per the filing, Softbank has increased its holdings in SYM stock by 900% on a quarter-over-quarter basis. Further, it recently launched a joint venture (JV) with Symbiotic called GreenBox. Additionally, the unit will buy SYM’s AI-powered systems “worth $7.5 billion in the next six years,” according to a recent press release.
Symbotic’s management said during the Q3 conference call that the systems sales contract with GreenBox has increased its contracted backlog to about $23 billion. Moreover, it has expanded SYM’s total addressable market.
Highlighting the JV, Goldman Sachs analyst Mark Delaney said that the GreenBox deal has increased SYM’s backlog. Further, the analyst remains optimistic about Symbotic’s long-term growth potential. However, on August 2, he reiterated a Hold recommendation on SYM stock due to its rich valuation.
Symbotic stock has received eight Buy and four Hold recommendations in the past three months for a Moderate Buy consensus rating. Meanwhile, the average SYM stock price target of $51.64 implies 32.6% upside potential from current levels. However, the stock has a Neutral Smart Score of 7 out of 10 on TipRanks.
Is WeWork a Good Stock to Buy?
WeWork stock has crashed this year. The coworking and shared office space provider is struggling to remain afloat amid declining occupancy rates, higher losses, an increase in churn rate, and liquidity concerns.
Despite the concerns about its ability to sustain business, Softbank increased its holdings in WeWork by 343% on a quarter-over-quarter basis.
While Softbank increased its exposure to WeWork stock, BTIG analyst Tom Catherwood downgraded the stock to a Hold on August 9. The analyst said, “Flexible workspaces have a future in the office ecosystem, but WeWork, in its current state, may not.”
WeWork stock has received one Buy and three Hold recommendations for a Hold consensus rating. Meanwhile, it has an Underperform Smart Score of 2 out of 10 on TipRanks. However, the average WE stock price target of $2 implies a massive 1,111% in upside potential.
The Takeaway
Investors can take cues from the trading activities of top hedge funds and institutions. However, they should consider analyzing stocks on multiple parameters, like fundamentals, analysts’ ratings, and insider transactions, among others, for long-term investments.
Thus, one can use TipRanks’ valuable tools like the Smart Score, which scores stocks based on eight key parameters, such as Wall Street analysts’ ratings, fundamentals, corporate insider transactions, and technical analysis, among other metrics.
Based on its Smart Score, investors should take caution before investing in WeWork stock. Meanwhile, Symbotic’s Neutral Smart Score indicates that its stock price could move in line with the broader market from here.
