The market has some investors on edge, but Bank of America named a host of stocks this week that analysts say are well-positioned in the current environment. The firm said these companies have an attractive risk/reward with plenty of upside. CNBC Pro combed through Bank of America research to find stocks to buy amid the uncertainty. They include Blackrock , Wells Fargo, Meta and TJX Companies. Wells Fargo The banking giant is firing on all cylinders, according to analyst Ebrahim Poonawala. The firm recently came away from a meeting with Wells management with even greater conviction on the stock. “In addition to gaining lending market share, management [is] laser focused on boosting credit card offerings, turning around the wealth management business and growing investment banking revenues,” he said. Poonawala also said that Wells is “among the best-positioned [global systemically important banks] to adapt to Basel reforms.” The Basel reforms are an international regulatory framework that mandate how much capital banks need to hold. Wells offers one of the “best risk/rewards” in the banking sector, he added. The stock is down 0.2% this year, but gains are expected, BofA said. “WFC is a multi-year transformational story with multiple catalysts,” Poonawala wrote. TJX Companies The discount retailer reported strong second-quarter earnings earlier this month with a beat on the top and bottom line. Analyst Lorraine Hutchinson says the company’s comp and gross were so impressive it “exceeded that high bar.” “Share gains [have] become evident,” she said. And it’s not just the company’s TJ Maxx stores or Marshall’s. It’s TJX’s HomeGoods stores that are coming through. Hutchinson said that, after several quarters of negative comps, HomeGoods “inflected to positive.” Additionally, Hutchinson is seeing signs that the the third-quarter is already off to a good start. “We view TJX as a market share gainer that is well positioned to benefit from trade-down and reiterate our Buy rating,” she wrote. TJX shares are up almost 12% this year. Meta Shares of Meta are down 10% this month but shareholders should remain calm, BofA said. Investor concerns about the recent underperformance are overblown, analyst Justin Post wrote earlier this week. “We think Meta is best positioned vs peers to capitalize on new spend in the industry given ramping Reels and Messaging monetization, easy comps, and increasing Advantage+ adoption,” he said. In fact, the bank says there’s no shortage of positive drivers looking ahead. Post says Meta will benefit from increased digital ad spend, e-commerce spending and burgeoning AI capabilities which will help the Instagram and Facebook parent take market share. Moreover, the stock’s valuation is attractive and “leaves room for more upside.” “We believe the stock could see renewed enthusiasm on 2024 upside potential once [the] Street has greater certainty on 2024 spending targets,” said BofA. Blackrock “Best positioned for rebalancings. We expect the BLK stock to outperform over the next 12 months as the firm continues to take profitable market share through its secular growth businesses where it has leading franchises and/or early mover advantages (ETFs, fixed income, multi-asset, ESG, alternatives, technology). BLK also has significant scale advantages, especially with global distribution as institutions and retail intermediaries consolidate their asset manager relationships.” Meta “Valuation leaves room for more upside. … We believe the stock could see renewed enthusiasm on 2024 upside potential once [the] Street has greater certainty on 2024 spending targets. … We think Meta is best positioned vs peers to capitalize on new spend in the industry given ramping Reels and Messaging monetization, easy comps, and increasing Advantage+ adoption.” Wells Fargo “In addition to gaining lending market share, management [is] laser focused on boosting credit card offerings, turning around the wealth management business and growing investment banking revenues. … Best-positioned GSIB to navigate Basel capital changes. … Best risk/reward in the group, in our view. … WFC is a multi-year transformational story with multiple catalysts.” TJX Companies “Share gains become evident and Home inflects. There were great expectations entering the quarter, but TJX’s comp and gross margin beat exceeded that high bar. We view TJX as a market share gainer that is well positioned to benefit from trade-down and reiterate our Buy rating. … The 8% Marmaxx comp was driven entirely by traffic and HomeGoods inflected to positive (+4%) after five quarters of negative comps.”
