20 Top Stock Picks the Analysts Love for 2019
Volatility was the name of the game for stocks in 2018. The market plunged to severe lows in both February and December, but all-time highs in September. The Standard & Poor's 500-stock index and Dow Jones Industrial Average were both on the precipice of bear markets late in the year. However, we enjoyed a surprising "Santa Claus" rally that saw the Dow climb more than 1,000 points - its biggest single-day point gain ever - on Dec. 26.
When you're evaluating stock picks for 2019, expect more of the unexpected.
Continued volatility seems unavoidable considering unsolved trade tensions and heightened worries about the Federal Reserve and interest-rate hikes. The flip side? "Despite the volatility that we have witnessed in the global markets, for 2019 our analysts are maintaining a pro-growth, pro-cyclical bias," RBC Capital writes in its 2019 outlook. Many Wall Street analysts, in fact, predict upside in 2019. That includes Deutsche Bank, whose 3,250 target for the S&P 500 next year implies more than 30% upside for the market!
With this outlook in mind, here are some of the analyst community's top stock picks for 2019. These are stocks, large and small, that boast a "Strong Buy" analyst consensus and significant upside potential. We used TipRanks to ensure that these picks also enjoy the support of top-performing analysts who have strong track records.
Alphabet
Market value: $732.5 billion
TipRanks consensus price target: $1,347.81 (28% upside potential)
TipRanks consensus rating: Strong Buy
Alphabet (GOOGL, $1,052.90), whose Google division is the largest ad-revenue-based internet business, has averaged 23% growth over the past 35 quarters and still is running hot. Moreover, it has $100 billion of net cash on its balance sheet - "dry powder (that) should give investors extra confidence amid market turbulence," five-star RBC Capital analyst Mark Mahaney writes.
"That's why we call Alphabet an internet staple."
Alphabet is overwhelmingly an ad-based company (RBC estimates that approximately 85% of the company's 2018 revenue will come from advertising), but it's trying to expand into other key businesses. Investments in hardware, cloud, Internet-connected homes and autonomous vehicles give GOOGL the potential for several more years of premium top-line growth and profits.
As with most stock picks in 2019, Alphabet isn't a 100% slam dunk. "There is regulatory risk," Mahaney writes, "though we have yet to find evidence that regulations will adversely impact the usefulness of Google for consumers or advertisers."
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