Best Strong Buy Stocks for a Stock Picker’s Market
There’s plenty for investors to contend with right now including stock market volatility and uncertainty about the direction of interest rates. That’s why those seeking out attractive investment opportunities might want to home in on Strong Buy stocks, or those names that analysts believe can outperform the broader market in the near term.
Current market conditions are ideal for what’s called a stock picker’s market. This is where folks choose individual stocks based on their singular merits, rather than put additional money into passive, broad-based equity index funds.
“We may be exiting the best S&P earnings per share era, but we are likely entering the best stock picker’s market in our careers,” says Savita Subramanian, equity and quant strategist at BofA Securities. “We recommend being invested in equities but selectively.”
That is not to say investors should ditch their index funds; rather, see this as an opportunity to add strong, individual stocks to their portfolio. Here, the bottom-up approach to stock picking is preferred to the top-down, to find good companies worth adding to one’s portfolio.
One group to consider is consumer discretionary stocks, which Subramanian recently double upgraded to Overweight from Underweight, the equivalents of Buy and Sell, respectively. The strategist cited several reasons, including expectations of a soft landing and no recession, as well as exaggerated headline risk – including potential student loan headwinds.
But the best stocks to buy are not found solely in the consumer discretionary sector. Here, we feature five Strong Buy stocks across a variety of sectors that analysts are bullish toward.
To narrow the list, we screened the S&P 1500 Composite Index to find some of the highest-rated stocks on Wall Street. We used data from S&P Global Market Intelligence, which surveys analyst ratings and scores them on a five-point scale. Those with ratings of 1.5 or below are considered Strong Buy stocks. Here are five that are worth consideration.
Data is as of Aug. 15. Analysts’ ratings are courtesy of S&P Global Market Intelligence.