Chicago, IL – November 19, 2024 – Zacks.com announces the list of Stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Pfizer Inc. PFE, Newmont Corp. NEM, Uber Technologies Inc. UBER, Adobe Inc. ADBE and Qualcomm Inc. QCOM.
Here are highlights from Monday’s Analyst Blog:
Buy 5 U.S. Majors for Sparkling Short-Term Returns
U.S. stock markets, in all likelihood, are set to close a solid 2024 after an impressive 2023. Although most of the rally has been driven by an unprecedented adoption of generative artificial intelligence (AI) technology across the world, cyclical sectors, such as industrials, financials, consumer discretionary and utilities have also taken part.
The bull run is expected to continue in the near future supported by a resilient U.S. economy, a declining inflation rate, solid earnings results, and the Fed’s re-initiation of a low-interest rate regime and accommodative monetary policies.
Despite the rally, several stocks have slid from their 52-week highs and are currently available at attractive valuations. Here we recommend five such U.S. giants with a favorable Zacks Rank. These are: Pfizer Inc., Newmont Corp., Uber Technologies Inc., Adobe Inc. and Qualcomm Inc.
2024 Investment Moto: Buy on the Dip
On Jan 5, I wrote that this year, buying on the dip would be the best strategy. (read: Best Investment Strategy for 2024: Buy on the Dip). Throughout the year, this strategy proved right. Every dip in stocks, especially in tech giants, has resulted in more aggressive returns in a short span. This trend is likely to last in the rest for 2024, too.
Any dip should be considered a good buying opportunity. Just a single positive catalyst will lead to a spike in stock prices. Wall Street has plenty of liquidity. At the beginning of 2024, a preliminary estimate revealed that a massive $1.4 trillion entered U.S. money market funds primarily due to an extremely high-interest rate regime, with cash yielding around 5%.
A systematic decline in the market interest rate will shift a major part of these gigantic funds to equity markets. Strengthening of the U.S. dollar and President-elect Donald Trump’s “America First” policies should attract more investors to U.S. stock markets.
Buy 5 U.S. Corporate Giants on the Dip
These five stocks are currently available at attractive valuations after sizeable corrections in prices. Moreover, these stocks are set to provide stellar returns in the short term. Each of our picks currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Pfizer Inc.
Pfizer’s non-COVID operational revenue growth is improving, driven by its key in-line products like Prevnar, Vyndaqel and Eliquis, new launches, and newly acquired products, including those from Seagen. Although revenues from PFE’s COVID-19 products are declining due to lower demand, huge profits from COVID products have strengthened its cash position.
The funds are being used to make acquisitions, increase dividends, buy back shares and reduce debt. Seagen’s acquisition has strengthened PFE’s position in the oncology market. Continued growth in non-COVID sales and significant cost-reduction measures should drive PFE’s profit growth.
Solid Price Upside Potential for PFE Stock
The stock is currently trading at a discount of 21.4% from its 52-week high. The average short-term price target of brokerage firms represents an increase of 24.7% from the last closing price of $24.80. The brokerage target price is currently in the range of $27-$45. This indicates a maximum upside of 81.5% and no downside.
Newmont Corp.
Newmont is making notable progress with its growth projects. NEM is likely to gain from several projects, including the Tanami expansion. The acquisition of Newcrest also created an industry-leading portfolio and provided opportunities for significant synergies. NEM also remains focused on improving operational efficiency and returning value to its shareholders. NEM is making notable progress with efficiency improvement programs.
Gold prices are hitting record highs this year, and the yellow metal has been among the best-performing assets. The rally has been driven by strong demand from central banks, a dovish Fed interest rate outlook, global uncertainties and a surge in safe-haven demand thanks to geopolitical tensions. Increased tensions in the Middle East and concerns over an economic slowdown also fueled safe-haven demand.
Robust Price Upside Potential for NEM Shares
The stock is currently trading at a discount of 30.3% from its 52-week high. The average short-term price target of brokerage firms represents an increase of 45.8% from the last closing price of $40.93. The brokerage target price is currently in the range of $47-$72.32. This indicates a maximum upside of 76.7% and no downside.
Uber Technologies Inc.
Uber Technologies’ Delivery business benefits from robust online order volumes. UBER’s efforts to expand its delivery operations through successive acquisitions are encouraging. Continued recovery in Mobility operations is also aiding UBER. For fourth-quarter 2024, UBER expects gross bookings of $42.75-$44.25 billion.
Apart from the recovery in Mobility operations and the strong performance of the Delivery unit, UBER’s focus on financial discipline is encouraging as well. For fourth-quarter 2024, adjusted EBITDA is estimated between $1.78 billion and $1.88 billion.
Excellent Price Upside Potential for UBER Shares
The stock is currently trading at a discount of 15.8% from its 52-week high. The average short-term price target of brokerage firms represents an increase of 27.9% from the last closing price of $73.25. The brokerage target price is currently in the range of $66 -$120. This indicates a maximum upside of 63.8% and a maximum downside of 9.9%.
Adobe Inc.
Zacks Rank #2 Adobe has extensively implemented AI applications across its flagship products, such as Photoshop, Illustrator, Lightroom, and Premiere. Earlier this year, ADBE introduced generative AI-driven Adobe Firefly. Moreover, Adobe Acrobat and Reader AI Assistant help users summarize documents and answer questions, saving time and helping users accomplish tasks faster.
Using its new AI-driven cloud-based platform, ADBE is also diversifying into digital marketing services, offering data mining services that help businesses measure page views, purchases and social media sites. Adobe Marketing Cloud enables marketers to deliver personalized web experiences across multiple devices, manage multichannel campaigns and optimize media monetization.
ADBE has launched Adobe Express, an application for quick editing effects. Leveraging generative AI, this tool is useful for short-form video content like Instagram Reels. Adobe also launched an AI-based Express app for iOS and Android.
Impressive Price Upside Potential for ADBE Stock
The stock is currently trading at a discount of 21.1% from its 52-week high. The average short-term price target of brokerage firms represents an increase of 14.4% from the last closing price of $503.37. The brokerage target price is currently in the range of $440-$703. This indicates a maximum upside of 39.7% and a maximum downside of 12.6%.
Qualcomm Inc.
Qualcomm is increasingly focusing on the seamless transition from a wireless communications firm for the mobile industry to a connected processor firm for the intelligent edge. With the accelerated rollout of 5G technology, QCOM is benefiting from investments toward building a licensing program in mobile.
QCOM formed a strategic collaboration with Google to develop Generative AI digital cockpit solutions. QCOM also recently introduced powerful automotive platforms to bolster the in-vehicle digital experience and facilitate automated driving. These initiatives are driving growth in the automotive business. Strength in the Android smartphone market is a tailwind.
Huge Price Upside Potential for ADBE Stock
The stock is currently trading at a discount of 30.4% from its 52-week high. The average short-term price target of brokerage firms represents an increase of 28.4% from the last closing price of $160.50. The brokerage target price is currently in the range of $160-$270. This indicates a maximum upside of 68.2% and a no downside.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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