J.P. Morgan has published its monthly analyst focus list of top stocks, based on the strategies of “near-term, growth and value.”
There were two new entrants on the list: cloud software giant Salesforce (CRM), under the growth category, and residential real estate broker Realogy (RLGY), under the value category.
As for Salesforce, “We see the potential for Salesforce.com’s Q4 results to outperform
lowered expectations,” J.P. Morgan analyst Mark Murphy wrote in a commentary. He said the company is “at the center of digital transformations and driving multi-year compounding of the topline at scale, while delivering considerable cash flow.”
In addition, Murphy is “encouraged by the results of our recent fourth-quarter partner and customer surveys, which signaled healthy end markets and better forward-looking indicators than investors might have expected,” he said.
Looking at Realogy, it has an “improving balance sheet,” wrote J.P. Morgan analyst Anthony Paolone. He also cited stock buybacks, a return to investing in the business and better-than-expected 2022 earnings guidance.
“Our structural view on housing is positive,” he said. And Realogy has a “very low multiple at sub-6 times EBITDA [earnings before interest, taxes, depreciation and amortization] and cash flow,” Paolone said.
Other companies appearing on the list are:
Bank of America (BAC) and Bank of New York Mellon (BK) for near-term opportunities.
Amazon (AMZN), Apple AAPL, semiconductor company Broadcom (AVGO), pharmaceutical giant Eli Lilly (LLY), Microsoft (MSFT) and railroad company Norfolk Southern (NSC) for growth; and Construction equipment company Caterpillar (CAT), General Motors (GM), and McDonald’s (MCD) for value plays.
