So far this year, the S&P 500 is up around 16 percent. Bank of America has come up with updated recommendations for the short-term investor looking one quarter ahead.
“Bank of America’s macro view has evolved over the past quarter,” strategist Anthony Cassamassino wrote in a note on Monday.
Their US equity strategist, Savita Subramanian, recently declared that the bear market was over. At the same time as Michael Hartnett maintains his negative view of the stock market. In addition, another economist in the company, Michael Gapen, has moved on his recession claim, and expects only a moderate fall next year.
Bank of America has compiled its top 10 ideas for the new quarter, all with buy recommendations and here are five of them:
5 recommendations from Bank of America
SelskapsnavnTickerAksjekursBath & Body Works IncBBWI37.5Datadog IncDDOG98.38Lamb Weston Holdings IncLW114.95Walt Disney CoDIS89.28Wells Fargo & CoWFC42.68
BofA
Bath & Body Works sells light and personal products and is referred to as a consistent growth company with a reasonable valuation. The company is growing and taking market shares in all categories and the bank sees several growth drivers going forward. They also expect better margins when cost inflation and shipping costs normalize.
In technology, Bank of America mentions software company Datadog. They believe that the demand for the services is good and that the company will benefit from developments in artificial intelligence.
Potato producer Lamb Weston is another stock on the list. Bank of America points out that restaurant demand, which makes up about 85 percent of the company’s sales, was resilient from March to May, even as price increases across dining and retail channels took effect in May. The bank’s analysts expect Lamb Weston to exceed expectations for earnings when the company presents results on 25 July.
Disney has risen 4 percent in 2023, which is far weaker than the S&P 500. Bank of America highlights that there is still strong demand at the parks and an increasing focus on quality and spending on content. Their $135 price target for the stock is more than 50 percent above Friday’s close.
Bank of America believes that Wells Fargo is one of the banking stocks with the best risk/reward. Last week’s regulatory stress tests, in combination with the fact that they are very solid, means that “the bank will be able to return surplus liquidity to shareholders in the form of buybacks or dividends”. In addition to the fact that the bank is better positioned to be able to handle changed regulatory capital requirements (expected proposal from the Federal Reserve to come in mid-July).
2023-07-04 17:59:12
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