3 Stocks to Watch in Q4

Q4 is here, and investors are searching for potential outperformers. With the market facing a number of challenges, it's important to select companies that are well-positioned to weather the storm and deliver strong results.

Wall Street analysts have, in the past few days, highlighted several stocks they believe are worth watching in the quarter. Below are three (two positive, one negative) they believe could see some movement this quarter:

Microsoft (NASDAQ: MSFT) gained almost 2% Monday after the stock was added to Wells Fargo's Q4 2023 Tactical Ideas List. Analyst Michael Turrin noted that the stock is down 10% since its Q4 report, as early enthusiasm around AI and Azure reacceleration settles somewhat. However, the firm now sees a favorable path for the tech powerhouse ahead of an improving ROY model trajectory. Wells Fargo sees several key catalysts ahead for the Overweight-rated stock.

Piper Sandler upgraded shares of Zscaler (NASDAQ: ZS) to Overweight from Neutral, raising the price target to $190, up from $160. The Wall Street firm said it sees a compelling setup for the company in Q4 and the coming year. In addition, it believes Zscaler will continue to benefit from solid trends in security spending and network transformation momentum.

After Tesla (NASDAQ: TSLA) missed consensus delivery expectations for Q3, Oppenheimer noted that investors will focus on Q4 GM as a critical driver of Perform-rated Tesla shares. Analyst Colin Rusch believes the impact of factory shutdowns was more substantial than anticipated, that with deliveries outpacing production, they believe worries regarding excess channel inventories will be mitigated and that gross margin will persist lower for longer. Rusch said the firm expects Tesla shares to remain down modestly following the delivery numbers.